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Valued Member
Posts: 48
Registered: ‎12-22-2009
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PIF or leave a small balance?

Is it better to pay in full or carry a tiny less than 10% balance? I am new to this CC thing, and while i paid it in full last month, I failed to do so prior to my statement being released, so it showed a high balance(I bought a large $ item on the card and then   PIF) and my score dropped due to carrying a large balance...so I am wanting to see if it will go up when the next statement is released, but will it be better to have a 0 balance or a $26 balance.....


Starting Score: EQ 581,NO TU
Current Score: TU 676, EQ 663 EX 653
Goal Score: 700


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Posts: 17,005
Registered: ‎07-14-2009
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Re: PIF or leave a small balance?

 


farmgirljen wrote:

Is it better to pay in full or carry a tiny less than 10% balance? I am new to this CC thing, and while i paid it in full last month, I failed to do so prior to my statement being released, so it showed a high balance(I bought a large $ item on the card and then   PIF) and my score dropped due to carrying a large balance...so I am wanting to see if it will go up when the next statement is released, but will it be better to have a 0 balance or a $26 balance.....


 

You never have to carry a balance forward which also means paying interest. Is this your only card? Each month have it report a small balance (1-9% of credit limit) on your monthly statement and then pay in full before the due date to avoid finance charges.

 

If you have more than one card try and have only one of them report that 1-9% utilization and the others show a zero balance on statements. The reason for this is FICO likes to see less than half of revolving accounts reporting a balance.

 

Optimal credit utilization for FICO scoring purposes seems to be:
Total revolving and individual utilization > 0 and < 9%, the lower the better, and
Reporting a balance on less than half of your revolving TL's, and
Reporting a balance on half or less of all TL's.

 

If I've completely confused you I apologize.  :smileyhappy:

 

 

From a BK years ago to:
9/09 EX pulled by lender 802
3/10 EQ- 800
4/10 TU -772

You can do the same thing with hard work

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Valued Member
Posts: 48
Registered: ‎12-22-2009
0

Re: PIF or leave a small balance?

Not too confusing. I paid the last balance off in full, and then used the card yesterday. My statement will be ready this week, but the finance charge date won't be until the 15...so if it won't hurt my score to leave the tiny charge on there, then I will- otherwise I will PIF today so it does not show up on my statement as carrying any balance. It is my only card....so if it is better to show usage and a tiny utilization than a 0 balance,  iw ill elave the tiny balance on it for now.


Starting Score: EQ 581,NO TU
Current Score: TU 676, EQ 663 EX 653
Goal Score: 700


Take the FICO Fitness Challenge
Moderator
Posts: 17,005
Registered: ‎07-14-2009
0

Re: PIF or leave a small balance?

 


farmgirljen wrote:

Not too confusing. I paid the last balance off in full, and then used the card yesterday. My statement will be ready this week, but the finance charge date won't be until the 15...so if it won't hurt my score to leave the tiny charge on there, then I will- otherwise I will PIF today so it does not show up on my statement as carrying any balance. It is my only card....so if it is better to show usage and a tiny utilization than a 0 balance,  iw ill elave the tiny balance on it for now.


 

There may be other opinions about this but since you only have the one card I believe it would help to to show a small balance. It also depends on the CRA. I've read here that each may score a situation like yours a little differently.

 

 

From a BK years ago to:
9/09 EX pulled by lender 802
3/10 EQ- 800
4/10 TU -772

You can do the same thing with hard work

Credit Scoring 101
Common Abbreviations
Frequently Requested Threads
Whats In Your FICO Score

Valued Member
Posts: 48
Registered: ‎12-22-2009
0

Re: PIF or leave a small balance?

Thank you! :smileyhappy:


Starting Score: EQ 581,NO TU
Current Score: TU 676, EQ 663 EX 653
Goal Score: 700


Take the FICO Fitness Challenge
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