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Senior Contributor
MattH
Posts: 3,245
Registered: ‎04-03-2008
0

Re: Payments every 5 days.


Mike14 wrote:

score_building wrote:

 

there have many discussions about this.  the bottom line is that it is NOT advisable to make multiple small payments if it can be avoided since it can give an issuer pause.  if this has always been your pattern they may not care as much but i definitely wouldn't suddenly begin to do this if you haven't been doing it all along.  YMMV but why not avoid pitfalls that may cause unnecessary alarm if we can?

 

 


 

And I've heard that CCCs may get scared if you charge groceries on your card, thinking that you're in trouble if you charge everyday items.  Well I've charged every grocery to one card or another.  I used to charge them all on my Citibank card for the 3% reward but then they dropped it to 2% so I started putting them on my Chase card for their 3% and Chase didn't seem to care one bit.  And neither did I.

 

To the OP: do whatever you feel you need to do to get your balance down to $0, then try to not carry one anymore.


 

My wife and I have been paying for groceries and most other things with credit cards for many many many years without any issues. But I don't think credit card companies care so much about what one's purchase pattern is so much as whether that pattern suddenly changes.  If somebody never used credit cards for groceries before and one day they start doing so, that could be a signal, especially if at the same time they start buying food with credit they start carrying a balance when they always paid in full before.  So the signal would not be groceries per se or carrying a balance per se, it would be that combination with a customer who never did either before.

 

Similarly, my wife and I very rarely shop at Wal-Mart, but on the rare occasions when we do there's about a 50:50 chance we'll get a call from the credit card company's Security Department because Wal-Mart is outside our typical pattern.  Somebody who has regularly shopped at Wal-Mart for as many years as we've regularly gone to Stop & Shop would probably not trigger an alert with a trip to Wal-Mart.

 

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Established Contributor
mt2va
Posts: 532
Registered: ‎03-20-2009
0

Re: Payments every 5 days.

While I don't make payments every 5 days on my CC I have made 2 payments this month so far on both of them.  I dropped them an email to see what their feelings were about this.  I can't believe someone that you owe money is going to think badly of you for sending 2-3 payments a month vs someone that pays the minimum once a month.  I always pay the minimum due (slightly higher), but if I have other money later in the month I throw extra money on there. 

 

Of course these are the first CC I've had in several years due to past credit issues so maybe I'm wrong in my thinking & things have changed.  I just know if I don't put the money towards the CC when I have it it may get spent later on something else.  I guess I could put it in my savings account & then pay my CC when it comes due from the savings account. 

 

My cash flow sometimes varies & I don't always know when I will have extra money.  I often use my CC to make purchases that I know I will have the money for in a week or two & when I get the money I just send a payment to pay off the CC. 

 

Until I saw this post I had no idea this would be considered bad.   

Starting Scores 10/12: EQ 460 (FICO)/TU 502 (FAKO)/EX 474 (FAKO)
Current (7/14): EQ 572 (FICO)/TU 624 (FICO)/ EX 612 (FICO)



Established Contributor
cdtotten
Posts: 951
Registered: ‎05-27-2009
0

Re: Payments every 5 days.

Like others have said, although they like the money coming in, if you are making several small payments that add up to barely the minimum or slightly more, it could indicate you are having severe financial distress and that you are likely to default. Making 1 monthly payment, even if it is the minimum, eliminates some of that unneeded worry.

 

Right now CCCs are slashing credit lines like crazy so you dont want to do anything to make them question yours.


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Senior Contributor
txjohn
Posts: 4,214
Registered: ‎09-12-2008
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Re: Payments every 5 days.


score_building wrote:

Mike14 wrote:

As long as they let you pay that often, I don't think they'd have any problem.  Some credit cards only let you pay 4 times a month (online, anyway) so just make sure you have at least paid the minimum amount due with the first few payments.

 

I don't think it looks like you're having trouble paying if you are paying!


i happen to agree with you-unfortunately what you and i think is inconsequential:  the fact is that frequent, scattered payments is considered suboptimal if you want your acct to be shed in the best possible light with any creditor generally speaking.  in fact most creditors do limit the number of payments you can make per period for this reason. 

 

there have many discussions about this.  the bottom line is that it is NOT advisable to make multiple small payments if it can be avoided since it can give an issuer pause.  if this has always been your pattern they may not care as much but i definitely wouldn't suddenly begin to do this if you haven't been doing it all along.  YMMV but why not avoid pitfalls that may cause unnecessary alarm if we can?

 

 


 

Only to provide input, I called each of the following CC accounts:  BoA, Chase, CapOne, Alliant, PenFed, NFCU and Juni/Barclays (Biz) and asked both the "back of card" CSR and then Backdoor numbers for those who had listed numbers this exact question:

"I often make multiple payments per month in order to maintain a lower balance.  Is this a problem or frowned upon by <CCC name>?" 

 

I did not have a single one, on any call tell me that they considered this risky or problematic.  A couple told me that it was not necessary, but no problem.  So, if this is a problem, it appears that it isn't from an Analyst or Manual Review issue, but would only be a problem by "automated computer analysis" flag.  But, would this flag auto AA, or flag it for review?  Who knows.  I just posted this for the input to topic. 

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Established Contributor
mt2va
Posts: 532
Registered: ‎03-20-2009
0

Re: Payments every 5 days.

[ Edited ]

txjohn wrote:

Only to provide input, I called each of the following CC accounts:  BoA, Chase, CapOne, Alliant, PenFed, NFCU and Juni/Barclays (Biz) and asked both the "back of card" CSR and then Backdoor numbers for those who had listed numbers this exact question:

"I often make multiple payments per month in order to maintain a lower balance.  Is this a problem or frowned upon by <CCC name>?" 

 

I did not have a single one, on any call tell me that they considered this risky or problematic.  A couple told me that it was not necessary, but no problem.  So, if this is a problem, it appears that it isn't from an Analyst or Manual Review issue, but would only be a problem by "automated computer analysis" flag.  But, would this flag auto AA, or flag it for review?  Who knows.  I just posted this for the input to topic. 


Thanks for your post txjohn.  I sent a message to NFCU as that is where my 2 CC are to see what they said also & I highly doubt they will consider it a problem.  But then as we all know CU are different than banks anyway. 

 

I just don't want to mess up my new CC that I have after not having credit in almost 5 years.  To my way of thinking it should still report paying as agrees on my CR so it should not in any way effect my credit score except that the more money I pay on my CC balance the lower my utilization. 

 

So are people saying this is bad because the CC issuer may decide to CLD my card or cancel it or something??  I really want to understand what is wrong about this practice.   Heck I pay my electric bill this way too & I've never had the electric company say I'm doing anything wrong. 

Message Edited by mt2va on 06-18-2009 07:27 AM
Starting Scores 10/12: EQ 460 (FICO)/TU 502 (FAKO)/EX 474 (FAKO)
Current (7/14): EQ 572 (FICO)/TU 624 (FICO)/ EX 612 (FICO)



Senior Contributor
score_building
Posts: 3,552
Registered: ‎01-10-2008
0

Re: Payments every 5 days.

several months ago i conducted a similar survey of issuers for a project i was working on about UD.  i too first contacted frontline csr.  frankly, i am not surprised at all at the results you got by cold calling.  i asked the the question, 'is it ok to use the cash advance portion of my cc without fear of a negative response from you as a result?'

 

of the 6 issuers contacted:

 

-only 2 (amex, citi) even hinted that a cash advance could be problematic in any way. 

 

-more than 1/2 said that they did not know the meaning of UD and/or didn't use it and only 1 (chase) admitted that it was being utilized as a "tool" at their bank.  at the time it had been confirmed that at least 3 or 4 of the 6 practiced UD routinely.  initially i was flabbergasted at the veiled responses but not anymore.

 

mt2va-  this issue is a rather marginal one at best.  you're back on the right path and should be pleased with your progress, things will likley continue to get better for you from here on out.  just keep making timely payments and if you want to try to limit the number of times per month going forward- great.  otherwise if it makes you more comfortable to ask your ccc if it is ok to make multiple payments, you can go with that info. (though i wouldn't).  this does not appear to be an issue with cu.

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Contributor
pjohnston2
Posts: 78
Registered: ‎02-18-2009
0

UD?

What is "UD"? 

 

I did a search on here but because I'm only looking for 2 letters, no results.

Established Contributor
Ulan
Posts: 790
Registered: ‎09-09-2008
0

Re: UD?


pjohnston2 wrote:

What is "UD"? 

 

I did a search on here but because I'm only looking for 2 letters, no results.


Universal default.

Frequent Contributor
Karatz
Posts: 318
Registered: ‎09-25-2008
0

Re: Payments every 5 days.


mrpeabody wrote:
I am a waiter and I have been adding my tips every week, and paying a % to my credit cards. Is there anything wrong, in the eyes of the bank (citi), if I pay so frequently?

I pay 60 bucks automatically to my CITIbank Amex smack i the middle of the month...or 15 days before the due date. Then I PIF a few days before the due date. One is to avoid late charge if something goes wrong for whatever reason, and two, if you don't want to or cant PIF thats ok, just save up however much you can and then pay in one lump sum. Unless each of your payments is a PIF, its probably not a good idea cause thats alot of transactions they dont make money on. If you do PIF that many times per month, you'll end up with at 50k limit card in only a few years maybe even as little as two years.

TransUnion/Equifax
746/754
Date: 9/24/2009/10/02/2009
Frequent Contributor
Karatz
Posts: 318
Registered: ‎09-25-2008
0

Re: Payments every 5 days.


mt2va wrote:

score_building wrote:

mrpeabody wrote:
I am a waiter and I have been adding my tips every week, and paying a % to my credit cards. Is there anything wrong, in the eyes of the bank (citi), if I pay so frequently?


 

yes - so to avoid potential concern that you are struggling to pay, try to limit payments to a couple of times a month (or just once a month ideally).


I've never heard of this before.  I just finally got my 1st CC after not having any for a long time due to messing up & they were charged off.  I've made 4 payments on it already.  So are they going to think that is bad.  The 1st statement hasn't even hit yet.  Like another poster I would think they would be happy to have the money whenever I send it in.  The payments I sent in are all more than the minimum due.  I've just been sending money when I received it to cover items I charged. 


Ya I agree, in that case its probably ok. 20 or 30 every few days on a 10k balance card seems pointless; however, after reading this post, my dad used to make several $100 payments on a cap1 card. His reasoning was first to make the minimum payment, then to cover what he was charging, and then to pay a little bit more so what he owed would go down. Well, they lost a payment. I'm not going to even go into what it took to get that 100 credited cause it's gonna make me very angry. I'd also suggest if you make multiple payments close together, make them different amounts, that way one cant disappear without you noticing or without them saying it was the previous or next payment.

TransUnion/Equifax
746/754
Date: 9/24/2009/10/02/2009

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