Confused about Reporting Balance to CR... Shed some light?

[myjourney]

---

@14Fiesta wrote:

---

@parakleet wrote:

The statement balance is what is typically reported to the CR. If you're wanting to play the utilization game for maximum scoring, it is generally thought best to pay down your balance to anywhere from 1-9% before your statement closing date. 

Edit to add: Need to also mention that utilization has no memory, meaning that you only need to play the utilization game if you're planning to apply for credit for maximum scoring. No need to do this every month if you're not planning applying for any credit. 

---

I have a question on this. True, that for FICO scoring, utilization has no memory, but your utilization from past months is recorded down hard on your actual CR. I'm fairly new to everything, so I just checked my EX report for the first time last week from the 1 free report a year site from the govt. Inside it listed all the previous balances from the statement cutting since I got my IT card. So while technically while your FICO score has no memory, when applying for credit, won't potential lenders see that you had high balances the last couple of months? Even if you paid it down, they might see your application as an attempt to gain more credit to run up the balances again (possible reason for denial?). Maybe I am over thinking this, but that's why I have made sure I do not let a balance higher than $10 report for my card EVER. I don't want to look like I was desperate for the credit. Anyone's thoughts on this would be greatly appreciated.

---

Yes it's recorded on CR's as far as balances 

However Fico has no memory when it comes to UTL 

So this month is not affected by last month 

Next month is not affected by this month 

The only way a potential lender would know your monthly balances would be on manual review not on a instant approval tho

[14Fiesta]

---

@myjourney wrote:

---

@14Fiesta wrote:

---

@parakleet wrote:

The statement balance is what is typically reported to the CR. If you're wanting to play the utilization game for maximum scoring, it is generally thought best to pay down your balance to anywhere from 1-9% before your statement closing date. 

Edit to add: Need to also mention that utilization has no memory, meaning that you only need to play the utilization game if you're planning to apply for credit for maximum scoring. No need to do this every month if you're not planning applying for any credit. 

---

I have a question on this. True, that for FICO scoring, utilization has no memory, but your utilization from past months is recorded down hard on your actual CR. I'm fairly new to everything, so I just checked my EX report for the first time last week from the 1 free report a year site from the govt. Inside it listed all the previous balances from the statement cutting since I got my IT card. So while technically while your FICO score has no memory, when applying for credit, won't potential lenders see that you had high balances the last couple of months? Even if you paid it down, they might see your application as an attempt to gain more credit to run up the balances again (possible reason for denial?). Maybe I am over thinking this, but that's why I have made sure I do not let a balance higher than $10 report for my card EVER. I don't want to look like I was desperate for the credit. Anyone's thoughts on this would be greatly appreciated.

---

Yes it's recorded on CR's as far as balances 

However Fico has no memory when it comes to UTL 

So this month is not affected by last month 

Next month is not affected by this month 

The only way a potential lender would know your monthly balances would be on manual review not on a instant approval tho

---

Okay, so you're saying the computer that gives instant approvals online for people only looks at the FICO snapshot for this month, and doesn't actually consider the previous months util %?

[myjourney]

---

@14Fiesta wrote:

---

@myjourney wrote:

---

@14Fiesta wrote:

---

@parakleet wrote:

The statement balance is what is typically reported to the CR. If you're wanting to play the utilization game for maximum scoring, it is generally thought best to pay down your balance to anywhere from 1-9% before your statement closing date. 

Edit to add: Need to also mention that utilization has no memory, meaning that you only need to play the utilization game if you're planning to apply for credit for maximum scoring. No need to do this every month if you're not planning applying for any credit. 

---

I have a question on this. True, that for FICO scoring, utilization has no memory, but your utilization from past months is recorded down hard on your actual CR. I'm fairly new to everything, so I just checked my EX report for the first time last week from the 1 free report a year site from the govt. Inside it listed all the previous balances from the statement cutting since I got my IT card. So while technically while your FICO score has no memory, when applying for credit, won't potential lenders see that you had high balances the last couple of months? Even if you paid it down, they might see your application as an attempt to gain more credit to run up the balances again (possible reason for denial?). Maybe I am over thinking this, but that's why I have made sure I do not let a balance higher than $10 report for my card EVER. I don't want to look like I was desperate for the credit. Anyone's thoughts on this would be greatly appreciated.

---

Yes it's recorded on CR's as far as balances 

However Fico has no memory when it comes to UTL 

So this month is not affected by last month 

Next month is not affected by this month 

The only way a potential lender would know your monthly balances would be on manual review not on a instant approval tho

---

Okay, so you're saying the computer that gives instant approvals online for people only looks at the FICO snapshot for this month, and doesn't actually consider the previous months util %?

---

Correct 

[takeshi74]

---

@ryllz75 wrote:

Will it hurt my fico scores much with the 2300ish reporting?

---

It's very difficult for us to tell you.  Look at it in terms of utilization instead of balance.  As indicated above, even if you do lose points for letting that balance report you can rebound next time around.

---

@parakleet wrote:

Edit to add: Need to also mention that utilization has no memory, meaning that you only need to play the utilization game if you're planning to apply for credit for maximum scoring. No need to do this every month if you're not planning applying for any credit. 

---

I'd still suggest sticking to the 30% max recommendation even if not apping.  One can certainly go above that short term with no long term adverse effects but prolonged high utilization can lead to AA.

---

@14Fiesta wrote:

So while technically while your FICO score has no memory, when applying for credit, won't potential lenders see that you had high balances the last couple of months? 

---

Creditors can always have varying underwriting critieria and manual reviews that look into such detail.  However, I have yet to see posts that indicate that prior utilization was a reason for denial.

This is just one anecdotal data point but I have cards that were maxed out in the past (one was balance chased) and have received many approvals since then.  Not all received the best terms available but most of them did.  You can certainly do all the work to ensure that only $10 reports but it's really not necessry.

[longtimelurker]

And just one caveat: the statement date is the important one for most but not all banks.   A notable exception is US Bank, which will report your balance at the end of the month, regardess of your statement date.   So be aware of that.

Also, just in case this wasn't clear:

I'd like to show my records that i used my monthly limits but pay in full or at least only leaving 10% or less balance to it.

The point of the reporting is to other issuers, your own issuer knows exactly what you spend throughout the month, and doesn't rely on the statement balance for that.