Can I reduce my utilization to below zero?

[larrylock]

Ok, just a hypothetical question, but I think I'm going to explore further if no one has tried this before. Must be the engineer coming out in me.

Say I have card X and I use this card to pay monthly purchases that equal to about $1000/month.  Lets also say that card X post the the CA's on the 10th of each month.  So currently I PIF before this date and my card balance is zero.  0% utilization for this card.

Now say that when I PIF before the 10th I pay an extra $1000 to cover my future purchases.  My question becomes now does card x just show I have a balance of zero or will it show that I have a credit of $1000 to the CA thus causing my utilization to be negative?

Or maybe I should just get back to work and stop wasting time

[Lel]

In my experience, I can't pay any more than the current balance of my credit cards.

I have had credit balances on my rebate credit cards.  For example, I have a Shell MC that pays a rebate every month.  When I PIF before the statement date, my balance goes to zero.  But when the statement cuts, the rebate credit from the past month's purchases is reflected in my statement, and I'll have a -$12 balance, for example.  This reports as $0 on my credit reports.

[larrylock]

Back to reality from my daydream

[Anonymous]

Or say you returned something you purchased but already PIF your credit card to 0$?

[DI]

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@larrylock wrote:

Ok, just a hypothetical question, but I think I'm going to explore further if no one has tried this before. Must be the engineer coming out in me.

Say I have card X and I use this card to pay monthly purchases that equal to about $1000/month.  Lets also say that card X post the the CA's on the 10th of each month.  So currently I PIF before this date and my card balance is zero.  0% utilization for this card.

Now say that when I PIF before the 10th I pay an extra $1000 to cover my future purchases.  My question becomes now does card x just show I have a balance of zero or will it show that I have a credit of $1000 to the CA thus causing my utilization to be negative?

Or maybe I should just get back to work and stop wasting time

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It would show you have a credit of $1000 if you;re allowed to pay that much over.  But your credit reports would only show a zero balance.  

[Lel]

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JustinIND wrote:
Or say you returned something you purchased but already PIF your credit card to 0$?

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Oh yeah, that happened to me last summer.  PIFed a card 2 days before the statement date and then returned something the next day.  $35 credit on statement, but again the balance was just 0 on my CR.

I suppose the OP could buy a large flat-screen TV, PIF the card, and then return it to see a huge credit balance.  It would just be free money to the CCC until the OP charged up the credit balance though.  Just make sure there isn't a 10% restocking fee for making the return!

[Anonymous]

+1 DI

CR's show how much you "owe" in balance.  If you have a credit balance, then you don't owe anything and it will report $0.

Your CC statement, on the other hand, will show the credit balance.

THOUGHTS:  Some CC's, like CapOne, issue a refund of overpayment.  I always overpay my balance to make sure I get a $0.  And each month they adjust my balance with a refund and mail me a check.  So each month I deposit the overage ranging from $19 to $50.

Also, most CCC's will not authorize a charge above your CL, even if you have a credit balance.  Example:  You have a $1000 CL and have a $1000 credit balance (overpayment).  This does not equate to a $2000 CL (on most cards).  If you attempt to charge $1900, you generally get a decline.  However if you make a $1000 charge, then later make another $900 charge you generally will be approved.  The CCC authorizes up to your CL.  When the charge comes through, your credit balance is applied against outstanding charges, reducing your debit balance back to zero. 

Lastly, many CCC's will not allow an overpayment of the "current" posted balance.  However, you can send an overpayment through BillPay or by manual check.  CapOne allows overpayment by up to 10%.  BoA has never restricted my ability to overpay....I've had up to a $2000 credit balance with them.

IME

[MrShush]

In banking, this method is used as a money laundering tool...

[voidman]

Hypotheticaly, if you go below zero then it would not be any good for you coz anthing 0 and less means you dont need credit and you are not showing good credit usage.

I heard that some banks charge fees on negative balace. not sure. 

[haulingthescoreup]

I generally have a negative balance showing on my PenFed statement every month, resulting from my PIF'ing before the statement drops and then the crediting of my cashback for the month. So right now, my balance is ($-14.87), but $0 will report to the CRA's, and 0% util will be what shows.

What I had read about a negative balance is that if you don't put some charges on the card to cancel it out, they will eventually mail you a check for the amount and return your account balance to $0. I wouldn't be surprised to find that some banks were figuring how to charge you for them owing you, though.