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PiF vs carrying a balance

New Contributor

PiF vs carrying a balance

First of all I want to thank everyone for all the help and teaching you have provided me in the past few short weeks after discovering this amazing site & forums! So many of you have much knowledge and experience than I do. I'm trying to learn as much as possible which brings me to my question:

is it much better (ie for applying or credit scores) to PiF vs carrying a small balance around 1-9% UTL? I did read on another topic that you should only carry a balance on one card if you own multiple cards.

Thanks for any advice and tips!

All FICO scores as of 9.1.14: Exp 744, Eq 745, TU 764
Goal: 800+ across the board
Message 1 of 37
36 REPLIES
Super Contributor

Re: PiF vs carrying a balance


Danizzle wrote:

First of all I want to thank everyone for all the help and teaching you have provided me in the past few short weeks after discovering this amazing site & forums! So many of you have much knowledge and experience than I do. I'm trying to learn as much as possible which brings me to my question:

is it much better (ie for applying or credit scores) to PiF vs carrying a small balance around 1-9% UTL? I did read on another topic that you should only carry a balance on one card if you own multiple cards.

Thanks for any advice and tips!


To do your best to have 1 card report a balance of 1-9%

Before you app think...
Have you done your research of the CC?
Does it fit your spending?
Do you have a plan for the bonus w/o going into debt?
Can you afford the AF?
Do you know the cards benefits? Is it worth the HP?
Message 2 of 37
Super Contributor

Re: PiF vs carrying a balance

And, just to be clear, ideally you should PIF by the due date, the way to optimize the score is to let the 1-9% balance REPORT, so the statement cuts showing this small balance, but then you pay in full to avoid interest charges.  Often, people use "carry a balance" to mean paying less that full, so that the balance is carried to the next month, usually creating an interest charge.

Message 3 of 37
Frequent Contributor

Re: PiF vs carrying a balance

letting the balance report, not carrying one, always pif before due date

 

i had few hundred dollars on my boa card, i paid it down to about 5% utilization, statement closes tonight, so the balance will report, but will be paid off well before the due date next month


If a man empties his purse into his head, no one can take it from him. An investment in knowledge always pays the best interest. - Benjamin Franklin |Capital One Quicksilver Cash Rewards|Chase Amazon Visa Rewards|BOA Cash Rewards|Walmart Mastercard|Commence MC| Citi Double Cash| Amazon Prime Store Card|Discover It|Chase Freedom|Chase Freedom Unlimited|Amex BCE|Wells Fargo Cash Wise|Barclays Cashforward
$83,300 total card credit FICO Equifax-803, FICO Transunion-791, FICO Experian-771 , DTI-3.4%
Message 4 of 37
Moderator Emerita

Re: PiF vs carrying a balance

Message 5 of 37
Valued Contributor

Re: PiF vs carrying a balance

You never need to carry a balance (this requires you to pay interest) in order to maximize credit score.

This link, and all the links inside it should help you.

http://ficoforums.myfico.com/t5/Credit-Cards/Best-ratio-of-balance-for-multiple-cards/td-p/1898219

In My Wallet: Amex BCP (12/12) $50,000, Chase Freedom (12/12) $16,500, Cap1 Quicksilver (6/12) $14,000, Barclaycard Rewards (5/13) $10,500, Citi Prestige (4/16) $30,000

Last App: June 27, 2015
Message 6 of 37
New Contributor

Re: PiF vs carrying a balance

Thanks guys. I should have clarified that by "carry a balance" I meant report a balance. I always pay at least the closing statement balance and have yet to pay any interest.

All FICO scores as of 9.1.14: Exp 744, Eq 745, TU 764
Goal: 800+ across the board
Message 7 of 37
Frequent Contributor

Re: PiF vs carrying a balance

Hi ALL:

 

I just applied for a Freedom at a Chase branch. Got approved for a low limit of $500 (called EO for CLI, in progress). 

 

My banker said it was probably due to a charge off I had even though it was well over four years ago and just waiting for it to fall off.

 

I told him I didn't mind the limit as long as my foot was in the door.

 

FWIW, he said that auto-CLI's do happen, and recommended that you leave a dollar on your balance or so, that way Chase can make a little money from you, and they may reward you with a CLI. For example, use 100, pay off 99, reolving $1, which is 2 cents interest, etc etc.

 

Not sure if this is good advice at all, but making yourself look like a profitable customer may allow you a little more "Freedom"

Capital One Quicksilver MC $3000 6/2011 | Chase Amazon Visa $1400 8/2012 | Citi Diamond Preferred MC $4200 7/2013 | AMEX Green NPSL 8/2013 | Chase Freedom $1000 Visa 8/2013 | AMEX BCE $7000 2/2014 ==> 2/2013
Message 8 of 37
Frequent Contributor

Re: PiF vs carrying a balance

@Shock_

 

Chase makes money off you whether or not you carry a balance. Every time you swipe a card, the ccc makes money. It is completely possible for a ccc to make more money from someone who uses the card heavily but PIF than from someone who barely uses the card and carries the small balance. 

Message 9 of 37
Valued Contributor

Re: PiF vs carrying a balance


Dubious wrote:

@Shock_

 

Chase makes money off you whether or not you carry a balance. Every time you swipe a card, the ccc makes money. It is completely possible for a ccc to make more money from someone who uses the card heavily but PIF than from someone who barely uses the card and carries the small balance. 


+1

Anyone else notice the CCs are starting to push world cards now (higher swipe fees)?

Message 10 of 37