Anyone have absolute proof that keeping a zero balance lowers your score?

[Anonymous]

Hey Highlander.  Any particular reason you haven't closed those cards that charge you monthly fees?

Looks like you are paying over $150 per year in those fees.

[SouthJamaica]

---

@Anonymous wrote:

I have 2 cards that I have paid down to zero. I don't plan on using them any time soon, because they have zero perks. I want to keep them open though, so that I keep my AAoA up and utilization down. 

Does anyone have any solid proof that this does in fact lower your score? Verses keeping them at 1%? All I can find on the web is "I was always told.........." or "My Father said......"

If it is absolutely true...... Is it like 5 points or is it more like 20 off your score?

---

Keeping both cards at zero will produce a lower score than having one card at zero and the other showing a small balance.

[Anonymous]

They are my two oldest CCs from my credit wasteland days.  I hate paying the fee, but the AAoA hit would be brutal.

[JagerBombs89]

If your bank has Bill Pay, you can "push" a payment to your card that covers all charges plus fees before the statement cut.  This way, it will be a $0 balance and those fees won't be reporting.

[Anonymous]

---

@Anonymous wrote:

They are my two oldest CCs from my credit wasteland days.  I hate paying the fee, but the AAoA hit would be brutal.

---

Hey Highlander.  You may be under the impression that if you were to cancel those two cards, it would cause you to take a hit to your AAoA.  This is not true.  Your AAoA would be unchanged.  Closed accounts are factored into account age just as much as open accounts -- and furthermore the closed accounts continue to age.

When the two closed cards fell off your reports, then there would be a change to your AAoA.  But that would not be for another ten years -- at which time your AAoA would be far higher.  You would also presumably have more accounts by then, which would minimize the drop to your AAoA.  Finally, the drop to your AAoA when it did occur might not affect your score, or if it did only a few points.

[Anonymous]

---

@SouthJamaica wrote:

---

@Anonymous wrote:

I have 2 cards that I have paid down to zero. I don't plan on using them any time soon, because they have zero perks. I want to keep them open though, so that I keep my AAoA up and utilization down. 

Does anyone have any solid proof that this does in fact lower your score? Verses keeping them at 1%? All I can find on the web is "I was always told.........." or "My Father said......"

If it is absolutely true...... Is it like 5 points or is it more like 20 off your score?

---

Keeping both cards at zero will produce a lower score than having one card at zero and the other showing a small balance.

---

Hello SJ.  Like many of us (me included) you assumed that the OP's initial post and subject line meant that he had exactly two credit cards (total).  Later in the thread he revealed that he had four cards (possibly more) and that two of them will always be reporting a positive balance.

It looks like somebody else caught that and explained to him that the "All Zero = penalty" part of FICO applies to all of his credit cards reporting a $0 balance simultaneously. 

[driftless]

My score is lowest when all 4 of my cc's report at 0%. Now, I don't worry about it, I keep using my cards and more than likely there will be charges that will hit from the payment due date until when the statement cuts.

[Anonymous]

As, shown by the examples given...Yes, there is a difference between one card or few cards showing a balance.

However, most ppl can't freak out about it because the difference in many cases isn't a death sentence month over month, it's just something to note PRIOR to submitting apps...

That is understanding application manipulation for looking as pretty as possible when apping for your loan or next CC, otherwise the 10-15 point spread isn't a huge deal enough to fret month over month.

Granted a stable, aged profile probably sees less of an affect in comparison to a younger less vetted profile, point being YES this is area can be too much for some to handle.

Many times folks take a morsel and make it a MEAL worth of importance...you see this all the time with the over importance given to a HP, yet folks NOT valuing or quite understanding debt ratio.

Point being it's a balancing act between apping and apping too much...it's always the DETAILS that make things uneasy and unsimplified.

We can speak about one card reporting X % with all others reporting zero as a goal but a goal for what? Every month?
A score of 780 vs 765 isn't that big a deal month over month ...one has to live their lives month over month.
And maybe pay attention to this stuff as need be, yeah, nice to know and consider 'as needed' otherwise for most ppl it's too many balls in the air to juggle monthly.