CLARIFICATION PLS! Make payments or PIF?

[zeusta20]

I've heard multiple feed back when it comes to making payments or paying off in full every month. To my knowledge, it's better to just pay off your balance in full every month. However, there's that other "myth" (to me it is anyway) that financial institutions want to see you making payments. To me, it's not rocket science. You're either able to manage your debt well or you're not.

Could someone clear up this confusion for me please! Is it better for your credit to pay it off in full every month, or is it better to show a payment history?

Thanks in advance!

[SnackTrader]

Paying in full DOES show payment history! It shows you can manage your credit responsibly. I always have, and plan to continue, paying in full to eliminate interest charges. Interest reduces, and in many cases completely eliminates, the benefits of rewards.

[jamesdwi]

PIF is always better in your creditors eyes, they make about 3% in swipe fees, if they only loan the money out for a month, before you pay for it, they can give it out again, for a real return of 36% a year it can get even higher if you pay the card off as soon as the charge posts.  At a minimal risk. In the current market allows credit card companies to borrow money at 1% or perhaps less. 

Of course if you don't pay they can collect the normal 22-24% APR while you pay. Of course the sub-prime ceditors don't care either way, high APR of course they would love it if you went over the limit or a late fee or two along with anual/monthly fees. 

[dodfire]

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@zeusta20 wrote:
I've heard multiple feed back when it comes to making payments or paying off in full every month. To my knowledge, it's better to just pay off your balance in full every month. However, there's that other "myth" (to me it is anyway) that financial institutions want to see you making payments. To me, it's not rocket science. You're either able to manage your debt well or you're not.

Could someone clear up this confusion for me please! Is it better for your credit to pay it off in full every month, or is it better to show a payment history?

Thanks in advance!

That is a good question.....and I think there are many answers to that. Or many thoughts anyways.

Now, as far as scoring goes....FICO scoring system does not like to see you carrying a balance of more than 9% try to keep your overall UTL below 9% and do this with just one card and let the others report as zero.

This is difficult to do at times because you have to make your payments based on when your CCC reports to the CRA. This is not just a matter of making payment on or before you due date.

As far as what the CCC's like....I think it depends on the bank. In my opinion, some CCC's LOVE to see you carry a balance so they can make more money with interest.

There are others....that I think would rather you not carry a balance and they just make their money off of the merchant where you use your card.

With that being said, I do not think that ANY of them mind you carrying a balance as long as it is managed properly. And from my experience they do not like to see you use more than 50%.

Others here might have some better input on this for both of us....Hope this helps a little bit. 

[zeusta20]

That's EXACTLY what I say too. But I have a sister who is 6 years older than me, I have better credit than her (thanks to all my siblings mistakes.lol.), and she just told me that for a NEW credit card, banks want to see a payment history. She had a credit card with a balance of 40.00 and made the minimum payment of 25.00 just to show the "payment history"...I WORK for a bank btw. I don't know why I have her second guessing myself. I guess it's because I never had that complete clarification.

Good to know that I have my mind going in the right direction. lol