What will help my credit score more?

[Poquelin]

Thank you to the community because it has provided very helpful answers to all of my questions.

Like so many of us in this community, I am trying to rebuild my credit. Currently I have 3 credit cards. Wells Fargo (secured $10,000 limit), US Bank (secured $5,000 limit) and Capital One (graduated to unsecured $2,500 limit). I use them but keep them at zero balance every month when they report.

I am a bit confused because I hear different things when it comes to managing credit cards:

1) use them but pay them off immediately so you always show a zero balance.
2) use them but don't pay them off entirely. Maintain less than 10% balance to show that you're able to manage having debt?

Which of the 2 options above will impact my credit score positively the most?

Thank you in advance for your responses

[guiness56]

During rebuilding, to obtain the optimum FICO score, have all but one CC report a 0 balance, the other one at 9% or less.  Then pay in full before the due date to avoid interest charges.  YMMV with the % reported as your entire credit profile is used for scoring.

This method is also used by those not rebuilding.

FICO does not like to see all cards with a balance nor do they like to see all cards reporting 0.

[alvon123]

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@guiness56 wrote:

During rebuilding, to obtain the optimum FICO score, have all but one CC report a 0 balance, the other one at 9% or less.  Then pay in full before the due date to avoid interest charges.  YMMV with the % reported as your entire credit profile is used for scoring.

This method is also used by those not rebuilding.

FICO does not like to see all cards with a balance nor do they like to see all cards reporting 0.

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+1