Can't max out cards and pay them off every month??? Please explain

[glamchick]

I pay off my entire balance every month and wait till my balance is reporting to the CB's.  So my balance on each statement is about $10.00 for each credit card.

Do you understand this statement below?  I found it on the internet.

Don't use your whole credit line every month - Your available credit is averaged over your billing cycle, which is sometimes less than 30 days. If your limit is say, $5,000 and you charge $5,000, even if you pay it off each month, your credit balance is still going to show $2,500 (a 50% usage limit), which is going to make your score plunge.

[Anonymous]

Ummmm.... I'd say this is inaccurate. I've certainly never experienced or seen this.

Where did you find this info?

[DustyStash]

Thats one of the weirdest things I've ever read in my 12 years in the credit field lol !   I'm not even sure that makes any sense or what the basis is for such a statement.  Your FICO score is based on whats on your report at any given time right ?  Whats on your report from a CC is usually a balance reported once a month and generally the balance you see on your last statement. I think this person has confused the averaging of utilization amongst total accounts. Thats all I could guess. The info there is certainly not correct, unless something radically new has popped up in the last few weeks, highly doubtful. You're fine to max out cards and pay them in full each month BEFORE the statement cut date, for purposes of credit reporting. Thanks for the headscratcher of the day ! =oP 

[glamchick]

Here is the site where i found the information.  I was so worried i thought i was doing it all wrong!!!   that would be to much for all credit cards to monitor how much your spending every month.  As long as you pay it off it shouldnt matter I thought.

This isnt the only site that states this information though which is also scarey.

creditinfocenter.com [Edited to remove the actual link-Marinevietvet,myFICO moderator]

[ScoreBooster]

That info is flat out wrong.

I AM maxing out my 5 CCs every month and pay them off right before reporting (4 of them report statement-balance, HSBC at the end of the calendar month). Once one card is maxed out, I pay it off prior to reporting and move on to the next. However, I'm still getting the best utilization possible.

There is a lot of wrong info out there. Some huge 3-in-1 report-providers are among them, stating that your score is depending on your amount of credit rather than the utilization.