Found out for myself...ALWAYS owe something on a CC

[Uborrow-Upay]

I had to prove this to myself, so I did...

Last month, I decided to have all of my credit card accounts report a balance of zero. Paid all balances before the statements cut, including a card which I'm on as an authorized user.

The result? My FICO score dropped 6 points! I know, that's no big surprise to the veterans here, but it still boggles my mind a bit.

A Negative on the report: No recent balances on revolving credit accounts

(and, in the same report)

A Positive: You've shown recent use of credit cards

This was a TU report. I didn't pull the others, I'm not seeking credit so this doesn't affect me one way or the other. I was just curious.

For the heck of it, I also went to Experian and pulled just their Vantage score. What a crock that is, one of the negatives (among not owing a mortgage because the house is fully paid for, and having an oldest cc account of ONLY 11 years age..too short) was low available credit!

My credit card utilization is 0 %, and has been under 2% for many months, with no one card over 9%. As I said before, I have no balances reporting now other than an auto loan.

So, two things I've learned...

1. Always have a small balance reporting on one card, at least.

2. Don't waste money to check a Vantage score from Experian. They're idiots (or, more accurately, I'm an idiot for thinking I'd get a fairly reliable score from them).

Anyways, now I know and you do, too!

Enjoy the day, folks! Happy Spring to All!!

P.S.  Message edited twice...for "affect", then "effect", then back to "affect" again!  Whew...shoulda spent more time paying attention in English classes! 

Message Edited by Uborrow-Upay on 03-20-2009 09:35 AM

Message Edited by Uborrow-Upay on 03-20-2009 10:03 AM

[Anonymous]

So every account on your CR was reporting a 0 balance?

[Uborrow-Upay]

yes, mjbfan79... $0 reporting on all, except car loan balance.

[moondog7324]

Manage your debt, not your FICO score.  I would rather be debt free and interest free than to have the perfect FICO score.

[llecs]

Thanks for posting! The fun comes when you try to tweak it to maximize points.

[Uborrow-Upay]

moondog7342, kudos for that thought, I've always felt that way, too. I only checked in the interest of "What if" I wanted the best rate for a new loan and how I'd prepare for it beforehand. I now know to carry a small balance.

llecs, tweaking could become a new hobby!

Regarding the Vantage score, I just had to call to find out about this low available credit thing. The rep I spoke with told me that it refers to the total amount of credit available. It does not mean (for them, anyway) how much of your available credit you've used. Apparently, they must want to see at least 100K in credit lines open. I don't have that on personal accounts, as they don't count Signature cards (which report as a credit limit of $0, and not as the high balance).

Experian is warped, IMO.

[Anonymous]

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@Uborrow-Upay wrote:
yes, mjbfan79... $0 reporting on all, except car loan balance.

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Well u should have been fine if u had a car loan reporting. I have 12 credit i'm gonna try my best to let only 1 report every month. I also have a car loan an personal loan on my credit report.

[Anonymous]

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@moondog7324 wrote:
Manage your debt, not your FICO score.  I would rather be debt free and interest free than to have the perfect FICO score.

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Yes i feel u there.

[LisaJ]

You know...I am finding that it is an addictive game, this fico thing!  Serioulsy, I have a new mortgage, I am happy with my car, I have enough credit for emergencies, yet I still hunger to see that score go up, up, up!!!  Wild.

Thanks for posting your experience.  I was about to pay off my last card with anything on it; I think I will leave it be, since it is under 9%. 

[athensguy]

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@moondog7324 wrote:
Manage your debt, not your FICO score.  I would rather be debt free and interest free than to have the perfect FICO score.

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Showing a balance doesn't require you to pay interest. The anti-credit folks would like for you to believe otherwise, though, since that little lie helps further their agenda.