How Many Months To Change Behavior...

[Andy77]

I have the following cards:

(1) Barclays

(3) capital one

(2) citi

(2) first premier

(1) bofa

I have just been paying the minimum payments for a long time now, probably 1.5 yrs and I am maxed out (within 15 bucks of limit on each card, I know very bad)

I am coming into some money soon and I am going to pay off all my cards, but my questions is if I completely change the way I have been using my cards...going from paying minimum payment with maxed out balances to paying off every month, how many months do I need to PIF for their computer systems to see my new the change in my bahavior and show them I have develped a new spending pattern?

[koalablue]

The computer system doesn't care about your spending pattern. Once you pay off your balances, your score should take quite a jump. Try to pay most or all of them before the statement cuts each month, so you'll have 0 balance. It will really help your utilization. Best of luck.

[zerobacan]

leave 1 with a balance, so you can be in the 1% to 9% utilization miracle number.

maxed out cards are the biggest score drop when you have a clean record

[Themanwhocan]

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@koalablue wrote:
The computer system doesn't care about your spending pattern. Once you pay off your balances, your score should take quite a jump. Try to pay most or all of them before the statement cuts each month, so you'll have 0 balance. It will really help your utilization. Best of luck.

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Well, yes and no.

Fico scores are basically a snapshot of your current credit at one moment in time. So once the various cards report, then a fresh Fico score should reflect the new utilization.

But Fico is only one part of the equation. If you are going to actually apply for a credit line increase, or even a new card, the company's computers will look at more than just a Fico score. I've had some CLI requests denied recently, and they quoted scores from account reviews that were almost 1.5 months old. And every company is different, heck, even different credit cards for the same company could use different criteria. There is just no way to know.

Of course, just about everything about credit cards is partially shrouded in mystery. You take your best shot, win or lose, and if necessary try again in 6-12 months. The only guaranteed way to lose, is not to play the game.

[koalablue]

True, credit card companies do often look at your payment pattern when making decisions. I was just saying its not factored into your FICO score. FICO is just looking at your utilization for that month, not whether you've been paying in full on previous months.

[Creditaddict]

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@koalablue wrote:
True, credit card companies do often look at your payment pattern when making decisions. I was just saying its not factored into your FICO score. FICO is just looking at your utilization for that month, not whether you've been paying in full on previous months.

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+1

Yup, just pay them all off... and since you have been revolving balances for long time don't leave a balance on ANY card because you are paying interest... after paying them completely off into the future if you are trying to play the game for BEST scoring, THEN leave 1 card with a very small balance but for now... just go for paying it all off and stop paying interest then we can worry about future charging.

[missjae]

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@Andy77 wrote:

I have the following cards:

(1) Barclays

(3) capital one

(2) citi

(2) first premier

(1) bofa

I have just been paying the minimum payments for a long time now, probably 1.5 yrs and I am maxed out (within 15 bucks of limit on each card, I know very bad)

I am coming into some money soon and I am going to pay off all my cards, but my questions is if I completely change the way I have been using my cards...going from paying minimum payment with maxed out balances to paying off every month, how many months do I need to PIF for their computer systems to see my new the change in my bahavior and show them I have develped a new spending pattern?

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I agree with KoalaBlue, but each current creditor can take your account history into consideration when assesing the acount for CLI's.  However, pay the cards off, except for one which you should pay to under 9% or 10% utilization and your scores will go up.  Then, use your cards like you would use cash, but PIF before the statement cuts (or before the due date if not looking for max score).  

I just did basically the same thing.  Had high utilization on a few cards.  As they report zero balances, my score goes up.  Discover gave me an auto CLI for $600 when I pif'd.  JC Penney gave me a $400+ CLI when I pif'd.  I was carrying large balances within a few hundred dollars of the limit for 2-3 years on each card.  As soon as all cards report zero and some time has passed for the creditors to soft me, I will ask for more of an increase.  If they deny me, I will show the better use of my card by using and paying in full.  While FICO scoring doesn't have a memory, I think individual creditors pay attention to your account history and after a few months of responsible usage, you should be good to go.  Just be patient since credit reports report quickly when there is something negative and slowly when there is something positive.