The difference between due date and posting date

[Anonymous]

So I remember I had read this information earlier this year in these forums but I've seemed to forgot. I remember reading that the most desired thing to do with credit cards is pay down your balance to 10-15% of the limit when it posts then pay off the remaining 10-15% afterwards so there is no balance at the due date.

My credit cards here due date is coming up at the end of the month. It says Due Date, Minimum Balance $15.00 due. So does that mean it's already past the posting date and that's the day I should have my balance down to $0.00? When do I know what day I want a balance of 10-15%?

I have Bank of America and American Express if that helps at all.

Thanks.

Message Edited by Scrubbicus on 12-15-2008 09:11 PM

[Junejer]

Call and ask when the statement date is and make sure that it reports between 1-9%.

[Scamp]

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Scrubbicus wrote:

So I remember I had read this information earlier this year in these forums but I've seemed to forgot. I remember reading that the most desired thing to do with credit cards is pay down your balance to 10-15% of the limit when it posts then pay off the remaining 10-15% afterwards so there is no balance at the due date.

My credit cards here due date is coming up at the end of the month. It says Due Date, Minimum Balance $15.00 due. So does that mean it's already past the posting date and that's the day I should have my balance down to $0.00? When do I know what day I want a balance of 10-15%?

I have Bank of America and American Express if that helps at all.

Thanks.

Message Edited by Scrubbicus on 12-15-2008 09:11 PM

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Most CCCs report your account balance as of your statement date, and most do the actual reporting to the credit bureaus ON your statement date as well (again - a few exceptions, including AmEx - you might try calling them and asking when they report your account to the bureaus, and be aware that when they DO report, it'll be with the previous month's balance).

So, in general, the trick is to either PIF before your statement/reporting date every month or to pay down to a tiny percentage of your overall credit limit (all zero balances can actually hurt your scores, so it pays to let at least one report a balance, unless you only have 1 or 2 cc's), let that tiny percentage report, then PIF once your statement cuts to avoid paying any interest.

If you have your statement, then most likely that account has already reported - what you'll want to go ahead and pay at least the minimum by the Due Date, then note the date of your BofA statement, as a month from that (approx.) is when your next statement/reporting date will be, and its THAT date you want to target (aiming for at least a few days beforehand, to allow the payment to post) with your next payment (if you're able to make another one) to control your reported balance or to PIF so that a 0 balance reports, if that's what you're going for.

With AmEx, I pretty much just try to PIF as the charges appear, and to avoid using it shortly before my reporting date.  I have 2, and I make them my 0-balance cards, each month.

Hope this helps! 

[Anonymous]

That did help.

What I'm trying to do is pay down all three (2 AmEx and 1 BofA) to 10% when it reports and than pay it in full right after it reports and before it's due. I do online banking and pay online for my credit cards so I check it frequently.  For all of the credit cards it'll show the balance and it'll have $0.00 payment due by --- due date. So I'm guessing at that time it hasn't reported, then it'll give me the minimum payment by a certain due date. When that shows up I'm guessing it's then reported the amount and now it's time for me to pay in full?

So what I'm getting at is, if that's correct, if I can drop or keep my credit at 10% on all credit cards until the due date shows up then PIF I'll be doing what I want to do. Is that also the best way to do it? Or is keeping 1 of my 3 credit cards report somewhere between 1-10% while the other 2 report at $0.00 better?

Thanks.

[haulingthescoreup]

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Scrubbicus wrote:

That did help.

What I'm trying to do is pay down all three (2 AmEx and 1 BofA) to 10% when it reports and than pay it in full right after it reports and before it's due. I do online banking and pay online for my credit cards so I check it frequently.  For all of the credit cards it'll show the balance and it'll have $0.00 payment due by --- due date. So I'm guessing at that time it hasn't reported, then it'll give me the minimum payment by a certain due date. When that shows up I'm guessing it's then reported the amount and now it's time for me to pay in full?

So what I'm getting at is, if that's correct, if I can drop or keep my credit at 10% on all credit cards until the due date shows up then PIF I'll be doing what I want to do. Is that also the best way to do it? Or is keeping 1 of my 3 credit cards report somewhere between 1-10% while the other 2 report at $0.00 better?

Thanks.

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You will actually do better if you pay two completely off before the statement drops, so that they report $0, and have the third card report 9% or less, and then pay it off.

With your plan, you'll have all three reporting balances. I would definitely not do that.

I have 11 open cards. EQ and EX let me get away with having 2 report balances before my scores drop; TU wants to see only one. Not everyone gets hit that hard, but since you're planning to PIF anyway, I'd do so with two of them before statement dates.

In your specific situation, I would definitely make the AmEx cards the PIF-before-statement cards. AmEx will report the balance on your statements, but it won't do so until 4 weeks after that statement. So you'll have $100 (or whatever) show on your statement as a balance; it won't show on your reports until 4 weeks later, 2 or 3 days after that you'll have your new statement with $0 on it, but that $100 will show up for another 4 weeks until it finally updates again to $0.

And even if cards report $0 month after month after month, there is some way that the creditors indicate that the card is active, so you won't get dinged on your scores for inactivity. And also, in a separate issue, the creditors also know (obviously) that the card is being used, so you won't get closed for inactivity. Having a $0 balance doesn't mean the card is sock-drawered.

[Anonymous]

Alright cool that all makes sense. So what I'll do is right after I recieve via e-mail my AmEx statements I'll PIF my AmEx cards. So for my Bank of America, for instance, my due date this month is the 29th. So I'm guessing if I don't PIF but the 29th I'll get interest, so my BoA card reported when I received the statement earlier this month or will I want to wait until the 29th, or 30th to pay because that's when it reports? I understand the AmEx reporting system now but what about Bank of America?

Thanks.

[haulingthescoreup]

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Scrubbicus wrote:

Alright cool that all makes sense. So what I'll do is right after I recieve via e-mail my AmEx statements I'll PIF my AmEx cards.

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Well, the problem with that is that once you have your statements, it's too late. The balance on them will be reported. I stop using a card 5 days before the statement date, pay it online on the CC website 3 days before, and go back and check the morning of the statement date to make sure that nothing else popped up. (For some banks, you'll have to do this sooner, as they delay crediting your payments.)

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So for my Bank of America, for instance, my due date this month is the 29th. So I'm guessing if I don't PIF but the 29th I'll get interest, so my BoA card reported when I received the statement earlier this month or will I want to wait until the 29th, or 30th to pay because that's when it reports?

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No, you shouldn't have to pay interest beginning on the statement date. There should be a grace period of a couple of weeks between the statement date and the due date. So if your statement posts or "drops" on the 12th, then your due date might be the 29th. Whatever the balance is that shows on the statement will need to be PIF'd before the due date to avoid paying interest. Your statement will included a minimum payment figure. Even if you can't PIF that month, pay the minimum plus $10 to avoid going on their deadbeat list.

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I understand the AmEx reporting system now but what about Bank of America?

Thanks.

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BofA is like almost all the other CCC's. On your statement date, say for instance the 12th, they report the balance due on your statement to the CRA's (credit bureaus.) Most of us find that that figure will show up on EX the next day, then EQ maybe on day 4, and then TU on maybe day 6-7. Sometimes EQ and TU swap the caboose roll.

You're welcome!


Typical schedule:

12/1: stop using the card; take card out of wallet
12/3: pay balance (or desired amount) online
12/5: statement drops. Balance on statement will be reported to the CRA's (exception: Juniper/Orchard bank cards)
12/21: due date. Any remaining balance must be PIF'd (to avoid finance charges), or at least the minimum payment must be made.

1/1: start all over again.

Note: if you pay before the statement date, but you don't PIF, you MUST remember to pay again before the due date, or you will be late!


edit to correct punctuation gremlin

Message Edited by haulingthescoreup on 12-17-2008 03:06 PM