What happens if I don't ever use a CC?

[Anonymous]

I am still learning about credit and have a quick question. What will happen if I don't use a card at all? I have one card that I use all the time and another that I activated, paid the yearly fee and now it is just sitting in a desk drawer. Will the card be cancelled if I don't use it? Will my credit score go down if it always reports a zero balance each month?

Thanks for your help

[Anonymous]

In my experience, when I never used one of my cards the status was never updated. Alternatively, when I used it for purchases or carried even a small balance then they would report it. I suggest just using the card for one of your usual monthly expenses and pay in full before statement cycles to avoid interest payment...

[Anonymous]

I'd put something small on that one card you paid an AF for and are not using each month. Something like a recurring $7.00 Netflix bill for example. Make sure you have 3 CR's, be it secured or standard, doesn't matter. Make sure to carry-over a balance on 1 of the 3 cards, making sure the balance is less than 10% UTI, if possible. Pay the other 2 cards off in full so they show a zero balance. If you never use a card, depending upon the issuer, they might close your account. It just depends on the card issuer. I'd try charging something on it, even if it's every few months. If you have a high CL, and don't use the card, the issuer may reduce your CL figuring there's no need for you to have it as your not using it, thus not proving to them you can pay it.

[Anonymous]

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@Anonymous wrote:
I am still learning about credit and have a quick question. What will happen if I don't use a card at all? I have one card that I use all the time and another that I activated, paid the yearly fee and now it is just sitting in a desk drawer. Will the card be cancelled if I don't use it? Will my credit score go down if it always reports a zero balance each month?

Thanks for your help

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If you have a card and are paying the yearly fee, why not use it?  Having a credit card is not necessary but it is important for credit buiding in case you want to buy a house, buy a car etc... If you have a lot of money and just don't like using credit cards then that is your choice.

For maximizing FICO, it is always best to have 1%-9% reporting.  Whether your score will drop will be dependant on other factors in your report.

[Revelate]

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@Anonymous wrote:
In my experience, when I never used one of my cards the status was never updated. Alternatively, when I used it for purchases or carried even a small balance then they would report it. I suggest just using the card for one of your usual monthly expenses and pay in full before statement cycles to avoid interest payment...

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Precisely why I'm going to kick my Walmart card to the curb - without reporting a non-zero balance they didn't generate a statement, and when they didn't generate a statement they don't update the tradeline to the bureaus.

Worse, after being paid to $0 for the next month, they don't always report that to the bureaus.  And a dispute as I found out, marks the tradeline in dispute but basically the window the lender has to respond to the dispute in (30 days), it will be reported with the next statement.  So utterly lame when optimizing one's reports for a big ticket application.  Don't get me started on trying to cancel the dispute either, sigh.  Exercise in futility.

It was so fustruating to me last month when I was trying to get uber clean for a mortgage, that I simply lost patience with it - not even a $0 AF card with a freebie FICO score is worth this much headache... though I suppose they'll eventually close it from inactivity so no need to close it.

I don't have to go through this stupidity with any of my other cards - fortunately most lenders don't do these shennanigans.  So not getting another store card again unless there's clearly market beating rewards associated with it.  1-2% difference from my other options other than truly large purchases doesn't make the grade either.

[takeshi74]

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@Anonymous wrote:
Will the card be cancelled if I don't use it?

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You need to confirm this with each of your creditors.  Policies on closure due to inactivity can and do vary.

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@Anonymous wrote:
Will my credit score go down if it always reports a zero balance each month?

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Tough to say what the net effect would be.  As you can see from comments above the tradeline may not update.  I'm not sure what impact there would be on other factors such as AAoA.

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@Anonymous wrote:

For maximizing FICO, it is always best to have 1%-95 reporting. 

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For maximizing lower is better.  95% will not maximize scoring.

[Anonymous]

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@takeshi74 wrote:

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@Anonymous wrote:
Will the card be cancelled if I don't use it?

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You need to confirm this with each of your creditors.  Policies on closure due to inactivity can and do vary.

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@Anonymous wrote:
Will my credit score go down if it always reports a zero balance each month?

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Tough to say what the net effect would be.  As you can see from comments above the tradeline may not update.  I'm not sure what impact there would be on other factors such as AAoA.

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@Anonymous wrote:

For maximizing FICO, it is always best to have 1%-95 reporting. 

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For maximizing lower is better.  95% will not maximize scoring.

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@Takeshi.

That was a typo and an error- 1%-9%.  Thanks for pointing it out-

[_NERD]

Damn!  I just got a Wally World card too /=