Is it best to use all credit cards a little each month?

[Anonymous]

Hi folks,

First time post but I've been lurking for awhile and reading everything.

My scores are about 700.

I have 15 revolving accounts, 8 are credit cards. The other are store cards or other types of revolving.

I have $23k maximum available credit cumulative among the 15 accounts.

I never use more than 10% on each card and pay off the total balance at the statement date.

I have heard before finding this board that it is best to use each card a little bit each month and not to continue a zero balance on any card for very long so to show continued on-time payment history and responsible management of many accounts.

Is this true or should I just use a few of the cards and keep the rest at zero balances?

Thank you in advance.

[Anonymous]

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@Anonymous wrote:
Hi folks,

First time post but I've been lurking for awhile and reading everything.

My scores are about 700.

I have 15 revolving accounts, 8 are credit cards. The other are store cards or other types of revolving.

I have $23k maximum available credit cumulative among the 15 accounts.

I never use more than 10% on each card and pay off the total balance at the statement date.

I have heard before finding this board that it is best to use each card a little bit each month and not to continue a zero balance on any card for very long so to show continued on-time payment history and responsible management of many accounts.

Is this true or should I just use a few of the cards and keep the rest at zero balances?

Thank you in advance.

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If you are just starting out, then you'd want to establish some sort of payment history.  But if you have 3-4 years of payment history under your belt then just use a few cards and keep the rest at zero...

Lastly, Welcome to MYFICO.

[tufa4311]

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@Anonymous wrote:
Hi folks,

First time post but I've been lurking for awhile and reading everything.

My scores are about 700.

I have 15 revolving accounts, 8 are credit cards. The other are store cards or other types of revolving.

I have $23k maximum available credit cumulative among the 15 accounts.

I never use more than 10% on each card and pay off the total balance at the statement date.

I have heard before finding this board that it is best to use each card a little bit each month and not to continue a zero balance on any card for very long so to show continued on-time payment history and responsible management of many accounts.

Is this true or should I just use a few of the cards and keep the rest at zero balances?

Thank you in advance.

---

It depends on what you are referring to here. When you mention on-time payment history are you referring to the history the credit cards see or the history that is on your credit report?

If you are referring to the history your credit cards see, then: yes, banks do like you to use the credit they issue you and you can potentially get a credit limit decrease, CLD, if you never or very infrequently use them. In addition, even if you do not get a CLD you may not be approved for a CLI if you use the card infrequently.

Now, if you are referring to your credit report, then: the majority, over whelming majority, of the time credit cards will report an "ok" status to the CB's if you use the card or not. That being the case, your credit report will have the "ok" status for that month and anyone who looks at it won't know if you used the card that month or not, only if you had any late payments beyond 30 days. Yes, they will see your UTIL but that won't show *when* that balance was incurred. Of course, your balance will affect your UTIL which will affect your credit score of course but that's another issue.

With regards to your balances, or utilization, question - you should have 1 card reporting a 1-9% UTIL every month, and only one (revolve among them). Remember, you can use all your cards as many times as you like in the same month but you must pay them all 100% off, except one, BEFORE your statement cuts, that way even though you used them it won't be reported - UTIL at the time of the statement cut is the only UTIL reported.

We are talking about appeasing two different beasts here - FICO and the Credit Cards. FICO wants to see 1-9% use on one card a month, the credit cards all want their cards to be used as much as possible to get as much interest and fees as they can.

[Anonymous]

Welcome to myFICO! Agree that you want to establish your pay history by responsibly showing usage of your cards. 

[Anonymous]

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@tufa4311 wrote:

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@Anonymous wrote:
Hi folks,

First time post but I've been lurking for awhile and reading everything.

My scores are about 700.

I have 15 revolving accounts, 8 are credit cards. The other are store cards or other types of revolving.

I have $23k maximum available credit cumulative among the 15 accounts.

I never use more than 10% on each card and pay off the total balance at the statement date.

I have heard before finding this board that it is best to use each card a little bit each month and not to continue a zero balance on any card for very long so to show continued on-time payment history and responsible management of many accounts.

Is this true or should I just use a few of the cards and keep the rest at zero balances?

Thank you in advance.

---

It depends on what you are referring to here. When you mention on-time payment history are you referring to the history the credit cards see or the history that is on your credit report?

If you are referring to the history your credit cards see, then: yes, banks do like you to use the credit they issue you and you can potentially get a credit limit decrease, CLD, if you never or very infrequently use them. In addition, even if you do not get a CLD you may not be approved for a CLI if you use the card infrequently.

Now, if you are referring to your credit report, then: the majority, over whelming majority, of the time credit cards will report an "ok" status to the CB's if you use the card or not. That being the case, your credit report will have the "ok" status for that month and anyone who looks at it won't know if you used the card that month or not, only if you had any late payments beyond 30 days. Yes, they will see your UTIL but that won't show *when* that balance was incurred. Of course, your balance will affect your UTIL which will affect your credit score of course but that's another issue.

With regards to your balances, or utilization, question - you should have 1 card reporting a 1-9% UTIL every month, and only one (revolve among them). Remember, you can use all your cards as many times as you like in the same month but you must pay them all 100% off, except one, BEFORE your statement cuts, that way even though you used them it won't be reported - UTIL at the time of the statement cut is the only UTIL reported.

We are talking about appeasing two different beasts here - FICO and the Credit Cards. FICO wants to see 1-9% use on one card a month, the credit cards all want their cards to be used as much as possible to get as much interest and fees as they can.

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There is really no need to do this, it just needlessly complicates things. Since the cards will have various reporting dates, it necessitates having short periods during each transition where either no balances are reported or two balances are reported. Far simpler to just keep the balance on whatever card has the highest limit. FICO has no memory with regards to UTI, so it does not care if the balance is on the same card or moves to a different card.