General Credit Topics

[Trying_to_climb]

Could you please explain how the "timing the payments work"? I pay some of my bills through automatic deduction others I send probably 13 days before the due date.  Shouldn't that be considered "before they close the month"? My scores have not gone up an inch.

[Trying_to_climb]

I just received notice that one of my accounts removed my three years old 30-day late and my score didn't go up.  Help don't understand.

[haulingthescoreup]

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Trying_to_climb wrote:

Could you please explain how the "timing the payments work"? I pay some of my bills through automatic deduction others I send probably 13 days before the due date. Shouldn't that be considered "before they close the month"? My scores have not gone up an inch.

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Hi, Trying --I don't want to derail this thread, so I'll give a really condensed version, and pls pm me for more info if you need. Most creditors report your status to the credit bureaus once a month, generally on the statement date. If you use your card a lot, and there is a high balance on that statement, it looks like you have a high CC debt, which hurts your scores. Even though you are then paying that before the due date, it's that high figure that is showing.

If you pay most or all of that figure 4 or 5 days BEFORE the statement drops (not the due date, but the statement date), this low figure is what reports and your scores wind up higher. hope that helps!

[jaramill]

If you pay most or all of that figure 4 or 5 days BEFORE the statement drops (not the due date, but the statement date), this low figure is what reports and your scores wind up higher. hope that helps!

When you say "statement date" do you mean the "closing date"?  I pay my bills on the "DUE DATE" then there's usually 7 days before the closing date in which a new statement is generated.  If you pay on the due date and then don't run up more charges in the next 7 days, then statement closes, then you can charge up and that balance is what gets reported, not anything after the closing date.

[haulingthescoreup]

It actually goes in the opposite direction. You get a statement, let's say it's dated on the 5th. It says that your balance is $700, minimum payment $35. You have until (let's say) the 27th to make that minimum payment or more. Then a week or 10 days after that due date, on the 5th of the next month, a new statement generates. It includes any new purchases you've made that weren't on the last statement, plus any balance on the last statement that you didn't pay off. And THAT figure will be due on the 27th of next month, and on and on. (Obviously these are all made-up dates.)

So anyway, the amount that is reported to the credit bureaus in most cases is that $700 that was on the statement. If your credit limit is $1000, that card is reporting 70% utilization, which is high. Even if you pay off the entire $700 the next day, that's not reported --the $700 is the figure that FICO knows about and uses to calculate your score.

If you go online 4 or 5 days BEFORE that statement posts, and pay for instance $650 of that $700, then only $50 of $1000 is reported, and suddenly that card shows at 5% util. And that makes FICO smile. After it posts, you want to be sure to pay it off before that due date on the 27th. This is how people use their CC's for every conceivable purchase, but their reported utilization stays very low.

(If you've got TrueCredit or another monitoring service that shows the exact date that your activity is reported, you can confirm the amount and the date of the report. Some CCC's report differently.)

Anyway, I've thread-jacked Tuscani's Success Stories thread! sorry...

[jaramill]

(If you've got TrueCredit or another monitoring service that shows the exact date that your activity is reported, you can confirm the amount and the date of the report. Some CCC's report differently.)

Ah thanks.  I actually called all my CCs and asked them when they report to the CBs and all were around or on the "due date".  I'll look into TrueCredit.

Back to our regularly scheduled topic....success stories.

[Angie10]

If you have any success with HSBC Auto and Chase Home Finance, please let me know.

[eknock007]

After ordering my free credit reports last November and sending out my first round of PFD and GW letters, I can honestly say that they do work. I have had two positive and two negative results so far. Still waiting for some answers.

Let me say this, you become very empowered once you know you can make changes to your credit file now rather than wait for time to do it for you, and for many of us time is as valuable as our finances. Anyway, still have some way to go. I am currently dealing with a couple of CA's and the notoriously unfriendly Verizon.

[armyguy80]

Just wanted to thank everyone on the forum and give others a word of encouragement. My quick story: I've never had a credit card, never had any problems with bills (except a few late payments on my student loans), no collections. I never worried about my credit score, never thought I needed to. Then I got deployed to Iraq in January of 2007. I cancelled my bills, moved out of my apartment, and my electric company and cable company both told me, in person, that I was paid in full and would never owe them another dime. So, I finally applied for a credit card in May of 2007. Rejected?! What?! So I pull my credit report. Has two collections, from (you guessed it) my electric company and cable company. Apparently they had no address to send my "final bill" to (even though they told me I had already paid my final bill) and sent it to collections. They knew I was deploying before I left, too. So I went into overdrive, and with my limited access (only some internet, no phone) I tried to figure out how to clear it up. I found out pretty quick that I should dispute, and not pay the debt collectors. Then I dug deeper and found this site, and started monitoring my score and disputing any mistakes on my report. I called any company I could, and for months I either was on hold for so long that I ran out of time at the phone bank (soldiers usually get 30 minutes apiece), or I got rudely brushed off. Finally, my mom was able to get through to the electric company, and after explaining my story, the woman she talked to ended up in tears. Her and the manager swore that they would fix it, and a few weeks later, I checked my credit report and both of the collections are gone. I'm still tying up loose ends and fixing the errors on my reports, watching my score go up, but I feel like I know the system now and can use it to my advantage, instead of just crossing my fingers and hoping I'll get approved or get a lower interest rate. Thanks to everyone on here, I've really learned a lot in a short time.

[wiwend]

I'm so glad that you got it straightened out, armyguy80. This kind of story just makes me CSR's that know you are going to be gone, with limited means to keep track of them, making sure they are doing their jobs, while you are off in a foreign country. There is no lack of people who just don't care and don't follow through on what they are supposed to be doing. Good for you (and everyone else here) to get on top of it and stick with it. I've been in customer service a lot in my life, and I can't imagine telling someone that I would take care of their problem and then not follow through on it. How do people keep their jobs?

Thank you for your service, armyguy80, and everyone else here who is or has been in service. You are the people who make me proud to be an American.