Established Contributor
Posts: 2,112
Registered: ‎09-25-2011
Re: Newbie Question......
[ Edited ]

Actually your both right and wrong depending on how you look at it. PIF is nice because you pay 0 interest, but there are benefits of leaving a balance. There is a utilization sweet spot for your Fico that goes ignored a lot. Based off of BobWang's calculations and spread sheet everyone has a sweet spot at 0-4% of their utilization.


I can't argue with a guy that has a 819 Equifax Fico04 score, and he has over 20k posts so he's been around the credit jungle for a long time lol. Try posting balances from 0% to 4% for a few months you'll see your scores jump around a lot. With my especially thin history I had a 15 point increase from 0 to 2% ymmv. So if it's for the sake of Fico science play around a bit, and most peopel building credit and experienting won't spend too much in interests this way cause their limits are low, and the experiement could pay off by over$10,800 in a mortgage loan if your Fico is increased by even 1 point (on the borer 719 to 720 etc)


Bob's Fico Chart

brother7 wrote:

Wolf3 wrote:

brother7 wrote:

Sitori wrote:

My head is spinning
Someone make this extremely easy...
If my statement date is the 12th and my due date is the 5th Tell me an exact date to pay an exact amount ....

I charged 157 with a $1200 CL
So What should I pay and when??

Btw is that too much ultilization

Pay $145 about 1 week before the due date. The remaining $12 balance (1% of 1200) will report on the next month's statement.

NOTE: if you made any charges AFTER the statement date, include that amount in your payment.

is that clear?

That is very bad advice!

Your statement balance is $158.   You should pay the full statement balance by the due date or you will be charged interest.   If you pay the statement balance in full (PIF) by the due the date there will be no interest charges.   Your due date is the same date each month and closing date can vary.   


If you can not pay the full statement balance, you should pay at least the minimum payment or you will be late, which usually includes late fees and bad marks on your credit report.   


Since you are new to this, I suggest you forget about all this utilization stuff for now, since it makes no difference except when you are actually applying for credit and your score is being calculated.    



Wolf3 is RIGHT and I stand CORRECTED.


You should PAY THE ENTIRE STATEMENT BALANCE BEFORE THE DUE DATE to avoid interest charges.

However, if you're like most people who use their credit card throughout the month, you'll have additional charges after the Statement Date. For optimal utilization (1%), pay off the additional charges before the Next Statement Date, but leave 1% balance. That balance will be your New Balance on the Next Statement Date.


Darnit, I was doing so well explaining this too. Thanks Wolf3 for pointing out the error.

total credit limits $108,400 Credit scores Ex 728 EQ 738 TU 758