Credit Cards

[superrupe2]

I have a Best Buy charge card for $1500. We bought a new TV for 3 years interest free On a montly, more than minimum has been paid on time since inception. Is this bad practice for my credit rating to use a credit card with no interest and let the balance ride? We are paying the minimum amount where the last payment will be paid a month before we lose interest free. Thank you!

[haulingthescoreup]

How much was the TV? In other words, how much of that $1500 CL did you use?

What are your total credit limits --the sums of the CL's on all your credit cards?

If the $1500 is 9% or less than your total CL, and if you don't let balances report on your other cards, you shouldn't see a score change.

If you have balances on other cards, and/ or if you charged nearly the entire $1500, you can definitely lose some scoring points.

You also run the risk of making your other CC lenders jittery. It doesn't take a lot to spook banks these days --their own shadows are enough, apparently.

[txjohn]

Depends on your credit shopping plans.  If you have all the credit you need, then not necessarily a problem.  If you are wanting to obtain new credit, then it may be one, but at that time you can PIF and upon CR update, you no longer have the FICO issue.

Tweaked FICO is like spit shine shoes.  They can be spit shined and in the closet, but what is the practical use?  You can't really wear them without messing up the shine.  If it's inspection time, spit shine.  Otherwise just keep 'em clean and buffed for general day to day use.

[Uborrow-Upay]

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txjohn wrote:

Tweaked FICO is like spit shine shoes.  They can be spit shined and in the closet, but what is the practical use?  You can't really wear them without messing up the shine.  If it's inspection time, spit shine.  Otherwise just keep 'em clean and buffed for general day to day use.

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Awesome analogy!  Right to the heart and "sole" of the matter...

[creditwherecreditisdue]

The only party I could think of who might under some circumstances take exception to carrying a high balance like $1,200 of $1,500 on a (as in one) retail card is Chase. (Because they hired a terrible consultant.) Even that would depend on what the rest of the credit picture looked like. If you are well diversified in your credit portfolio and whatever balances you are carrying are < 25% of your overall available credit you should be OK. Yes, you will take a FICO hit for being > 9%, but you have to weigh that against the value of the 0% APR. That is your tradeoff.

I just made a BT to a TL = $2973/$8200 = 36.25%. My overall UTIL is 9%. Am I worried about the higher UTIL on that one account? Not in the least. I made that move to save some money and only one TL has a UTIL like that. The only issuer who might have even the slightest interest is Chase and if they don't like it that's just too bad. It's not as if they have done anything great for me lately. (Or ever, really, except let me hang around.) And by the time I next want to app for credit that 36% will be down to 25% and all will be well.

Message Edited by creditwherecreditisdue on 07-27-2009 11:11 PM

[superrupe2]

Agreed! Perfect way to put it! Thank you for your help!