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Mr_JM
Posts: 1
Registered: ‎01-14-2013
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Amex and "sock-drawered" cc's, and balance reporting.

Got a couple qeustions. Forgive me for lumping this all into one post instead of breaking it into several.

 

#1 AMEX charge cards - are they considered different than revolving cc's? If so, would getting an AMEX charge card be considered as diversifying your credit types and help to boost your score?

 

#2 - I see the term "sockdrawered cc's" frequesntly. Obviously I get the idea (don't get a card and never use it). However, what is the length of time before using that card again can hurt you. Example - I got a cash rewards card. Since using it pays me back, I decided to use it for nearly everything and pay it off frequently (3 to 4 times a month) to keep the balance low. The rest of my cards have become nearly if not completely "sockdrawered" (which I guess I have to change). But recently I made a very small $2.40 purchase from a less than confident seller (yes, Two Dollars and Forty Cents). It caused my FICO score to go DOWN saying I "the balance had increased on a dormant card" or something very similar. Are you kidding? A $2.40 charge caused my score to go down? Never mind the fact I paid it off within a couple days. I don't see that being reported for my benefit. So now I'm nervous to start reusing all my cards as if it's going to cause my score to plumet because they haven't been used in a while. So a) how long will it take to rebound if I do use dormant cards, and b) what's the better path, take the score hits and hope they go away quickly, or keep the cards in the drawer so my score doesn't get hit so hard?

 

#3 As a continuation of #2, as I said I started using my cash rewards card for all my purchases, but I pay it off all month long. I know the rule is to use 9% or less if possible. Well, every now and then it goes above that (car repair for example). It seems as though almost immediately if I have a new balance that's higher than I've had before, it gets reported to FICO, and I'm sure it's only looked at negatively (haven't seen my score go down each time, but also haven't seen my score go up in a while). Yet the fact that I pay it down within a week (sometimes within a day or two) to back to less-than-10% levels never gets reported and I never benefit. I personally feel I'm not being rewarded (score wise) for being responsible with the card. Refering back to #2, I guess I could use a different card, but still, why doesn't the bigger picture get taken into account? You hit my score when I use the card, but don't bring it back up when I pay off the balance a day or two later? That's not responsible borrowing?

 

Thanks for anyone that has the info.

 

Jeff

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AndySoCal
Posts: 1,949
Registered: ‎04-07-2009
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Re: Amex and "sock-drawered" cc's, and balance reporting.

Regarding  #1  A charge card is not factored into your credit utiliiation. By a charge card I  mean a card where the balancne is due in full each month.  A charge card would add another loan type. I am not sure if the points gained by the additional loan type (if any) is worth the inquiry and the new account which will lower your score temporarily usually.

 

 #2 I would suggest using a card about every six months for the card being fully factored into your score. 

 

#3  The credit utilization is calculated by your total balances all revolving cards  divided by total credit limit on revolving cards. You may have a credit utilization on one card greater than 10% but the when all your other credit limits  and balances are factored in you may be less than 9%

Equifax My FICO score 815 5/28/2012, 818 on 7/28/2014 . Average of Accounts 12 years and no Installment accounts. MyFICO TU 810 6/26/2012 809 4/21/2013 MyFICO XPN -805. 2/26/2014 Discover TU FICO 813 App free since 9/2011
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Revelate
Posts: 9,731
Registered: ‎12-30-2011
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Re: Amex and "sock-drawered" cc's, and balance reporting.

Just as a clarification, a charge card (or store card for that matter) counts as a revolving account; this doesn't factor differently into FICO's mix of credit function than a standard credit card.

Starting Score: EQ 561, TU 567, EX 599* (12/30/11, EX lender pull 12/29/11)
Current Score: EQ 04 673, EQ 8 707, TU 720, EX 702* (09/02/14, EX older)
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pizzadude
Posts: 9,674
Registered: ‎01-28-2010
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Re: Amex and "sock-drawered" cc's, and balance reporting.

 

To clarify the utilization point - the balance on an AMEX charge card is not factored into revolving utilization ( except for the TU98 FICO score sold here ).    However it still counts as a card with a balance.

March2010 FICO® ~ 695 TU, 653 EQ, 697 EX
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stevo242
Posts: 1
Registered: ‎01-08-2013
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Re: Amex and "sock-drawered" cc's, and balance reporting.

My FICO TU score report lists a high credit utilization (65%), even though my revolving credit accounts are under 14%....is this because of my AMEX Gold card balance?  If so, why is my AMEX card (with no credit limit) calculated into my revolving credit utilization?

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pizzadude
Posts: 9,674
Registered: ‎01-28-2010
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Re: Amex and "sock-drawered" cc's, and balance reporting.

[ Edited ]

stevo242 wrote:

My FICO TU score report lists a high credit utilization (65%), even though my revolving credit accounts are under 14%....is this because of my AMEX Gold card balance?  If so, why is my AMEX card (with no credit limit) calculated into my revolving credit utilization?


That's correct ~ the TU 98 score sold here at myFICO does include the AMEX charge card balance in your utilization.    It uses the high balance as your credit limit, since the card doesn't report a CL.

 

March2010 FICO® ~ 695 TU, 653 EQ, 697 EX
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evaailie
Posts: 1
Registered: ‎01-20-2013
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Re: Amex and "sock-drawered" cc's, and balance reporting.

I have about 4 sockdrawered cards that I have had for several years that haven't been claimed dormant yet. Maybe I am just lucky?
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Revelate
Posts: 9,731
Registered: ‎12-30-2011
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Re: Amex and "sock-drawered" cc's, and balance reporting.


evaailie wrote:
I have about 4 sockdrawered cards that I have had for several years that haven't been claimed dormant yet. Maybe I am just lucky?

Welcome to the forums!

 

Maybe, which are they out of curiosity?  

Starting Score: EQ 561, TU 567, EX 599* (12/30/11, EX lender pull 12/29/11)
Current Score: EQ 04 673, EQ 8 707, TU 720, EX 702* (09/02/14, EX older)
Goal Score: 700 on EQ '04 (01/01/15)


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