topic Re: Credit card payments and CLI in Credit Cards

Credit card payments and CLI

bichonmom — Tue, 10 May 2011 18:31:14 GMT

I'm wondering which of the following scenarios is better in the eyes of the CCCs with a new CC to have a good history to get a bigger CLI (not for FICO score).

#1, You have a balance of $150 on a card and pay a little over the minimum pmt ($25 or $30) until it reaches zero... OR

#2, You have a balance of $150 on a card and pay the entire $150 and make a new purchase the following month, which you then PIF before the due date (but after the stmt).And you continue this each month... charge and pay the entire balance, but AFTER the cut-off date for the stmt.

I understand that it would be better for FICO score to pay it down to either zero or <9% of the CL, but I'm wondering in this example, and NOT for FICO, but for good history with CCC for CLI, which is better.

If I understand utilization correctly, it's used only by the CRAs to calculate FICO, and it is based on the ending stmt balance (and not the entire amount you charged on the card if you pay it BEFORE the statement cuts). Is that right?

Also, when current CCCs give you CLI, do they do a hard inquiry on your CR or just a soft one? (I'm assuming they would run one, especially with a newer card.)

Thank you!

Re: Credit card payments and CLI

Anonymous — Tue, 10 May 2011 19:03:07 GMT

If its an automatic cli, It better be soft....and who knws what the credit company is looking at, I belive each one has there own determination and some have no cli, just my thoughts

Re: Credit card payments and CLI

haulingthescoreup — Tue, 10 May 2011 19:23:06 GMT

Some parasite CCC's might be thrilled at your carrying balances and thus paying interest.

The decent ones seem perfectly happy with you wearing out the card and paying back promptly. If you pay online (and if they credit in a timely manner), you can charge far more than your CL each month without going over. That tells them that you like the card, you want to use it, you're responsible, and you sure could use a higher limit.

Which card is this, and do you have any ideas about how you wound up with the limit that they gave you?

Re: Credit card payments and CLI

bichonmom — Tue, 10 May 2011 20:46:57 GMT

@haulingthescoreup wrote:
Some parasite CCC's might be thrilled at your carrying balances and thus paying interest.

The decent ones seem perfectly happy with you wearing out the card and paying back promptly. If you pay online (and if they credit in a timely manner), you can charge far more than your CL each month without going over. That tells them that you like the card, you want to use it, you're responsible, and you sure could use a higher limit.

Which card is this, and do you have any ideas about how you wound up with the limit that they gave you?

Regarding the interest, you're right. I forgot to mention that it's 0% apr for a few months. So, there wouldn't be any finance charges.

It's a biz card with Cap One with a $500 CL.

I know I'm talking about using more than the <9% util, but right now I'm less concerned about the FICO score than I am with establishing the history w/Cap One to get a better CL, which will in turn increase the util $ I can use, and increase my FICO score in the long run.

Thank you!

Re: Credit card payments and CLI

Anonymous — Tue, 10 May 2011 21:15:05 GMT

I have two Cap1 CC's

Capital One Platinum 500CL

Capital One Platinum No Hassle Rewards 750CL

They are the two first CC's I applied for last year when I was rebuilding my credit, I have paid one in full every month (never late and use semi heavy) and carry a small balance one the other for util purposes (0% APR for the first year on both). I have tried for CLI's on the one Cap1 that I have PIF every month (11 months old this month) and I get the same thing every time, you are a WONDERFUL customer, your payment history is EXCELLENT, but we're sorry we don't do customer initiated CLI's, but keep up the GREAT job because Cap1 periodically reviews accounts and yours is the PERFECT candidate for review!! Uhhh BS!!!!

The reason I mention all that is because if it's a Cap1 starter card, It would be a MIRACLE if you EVER got a CLI.

If I may ask, what do your credit scores and reports look like? I'm wondering because of the low limit. I know Cap1 is a conservative lender, but a 500CL on a Business Card??

Re: Credit card payments and CLI

bichonmom — Tue, 10 May 2011 21:36:44 GMT

I actually just joined the myFICO SW and got my EQ Score: 667. My Experian FAKO a couple of weeks ago was about 605. EX has more inquiries due to CAs making hard hits and a collection I just DVd. No idea about TU but it's probably close to EQ because what's on the repts. is similar.

I haven't had any CCs in over 10 years so nothing shows on my CR except for 2 secured loans that I PIF in Dec 10. There is one collection that is due to come off Nov 2012. I am considering doing a PFD if they'll reduce the amount. I didn't pay because of a dispute with the OC.

I was actually quite shocked at the LOW CLs they gave me: 500 CL on the biz card and 300 CL on the personal one.They both come with an automatic CLI after 4 mos for the biz and 6 mos for the personal one. I am trying to use they as efficiently as possible to get the largest CLI without doing too much temp damage to my score.

Oops. Forgot. I just got an Old Navy card w/$200 limit.So i have 3 CCs total.

Thank you!

Re: Credit card payments and CLI

haulingthescoreup — Tue, 10 May 2011 21:39:35 GMT

Without any open revolving credit, it's not that surprising that your CL is kinda low.

It might not grow, but the account will certainly help get you back into good score ranges. You'll probably see a little bump as soon as it reports, and then another after six months or so of clean history.

Revolving credit is riskier than installment, so you're rewarded by having clean open revolving accounts on your reports.

I'm not familiar with their business cards, but my take on this one would be don't expect great things of it. But it will be a good stepping stone for you. After your scores rise (due to its presence), you might decide to go for other cards and eventually dump this one. It won't hurt you, because closed accounts should report for 10 years and they're still factored into your scoring, even though closed.

Re: Credit card payments and CLI

haulingthescoreup — Tue, 10 May 2011 21:41:24 GMT

OK, for some reason, my edit button stopped working, but I just saw your edit. So this isn't your only open CC, but nevertheless, it will help you. Just accept it for what it is and don't expect it to morph into something different.

Re: Credit card payments and CLI

Anonymous — Tue, 10 May 2011 21:47:22 GMT

@bichonmom wrote:
I actually just joined the myFICO SW and got my EQ Score: 667. My Experian FAKO a couple of weeks ago was about 605. EX has more inquiries due to CAs making hard hits and a collection I just DVd. No idea about TU but it's probably close to EQ because what's on the repts. is similar. 667 is not that bad, you're close to the 700 Club, keep paying all your CC's on time and by the end of the year if not sooner, you may just hit the 700

I haven't had any CCs in over 10 years so nothing shows on my CR except for 2 secured loans that I PIF in Dec 10. There is one collection that is due to come off Nov 2012. I am considering doing a PFD if they'll reduce the amount. I didn't pay because of a dispute with the OC. Sounds just like my credit file last year this time

I was actually quite shocked at the LOW CLs they gave me: 500 CL on the biz card and 300 CL on the personal one.They both come with an automatic CLI after 4 mos for the biz and 6 mos for the personal one. I am trying to use they as efficiently as possible to get the largest CLI without doing too much temp damage to my score. It sounds like you're in the "Credit Steps" program, thats exactly what I got on my two Cap1 CC's, 300 to start, then to 500 by the 4th statement and the second one was 500 to start and to 750 by the 6th statement.

Oops. Forgot. I just got an Old Navy card w/$200 limit.So i have 3 CCs total. Congrats on the Old Navy!!

Thank you!

Re: Credit card payments and CLI

bichonmom — Tue, 10 May 2011 21:59:40 GMT

Thank you for the replies!

I just pulled my TU FICO with myFICO's quarterly monitoring. It's 693. Better than I thought.

The sense I'm getting from the posts is that no matter what I do, the CLIs I'll get on these cards probably won't be very much. At least it's getting me to the point where I can get a better card, and improve my score.

I guess whichever way I use it, it won't make that much difference in the CLI.

Thank you!

Re: Credit card payments and CLI

Anonymous — Tue, 10 May 2011 22:59:03 GMT

In all honesty, these two Cap1 CC's I have were the first two I apped for when rebuilding, and have helped me reach the scores I have today (amongst other CC's I have paid perfectly as well) (and keeping my util <9%) I had a credit score of a 610 when I apped for these CC's, so I'm grateful they extended me credit when I really didn't deserve it, but it sure would be nice to see a CLI after almost a year of perfect pymt history.

They are good stepping stones, no doubt.

And Congratulations on the AWESOME TU Score!!!!!!! 693 is only 27 points away to having "Very Good Credit" according to FICO. I believe its 720 that will put you at "Very Good Credit"

Re: Credit card payments and CLI

bichonmom — Tue, 10 May 2011 22:54:53 GMT

It sounds like I shouldn't expect a CLI after the initial one. It's good to know that you've made so much progress in a year... gives me hope.

Thank you for the replies!

Re: Credit card payments and CLI

Anonymous — Tue, 10 May 2011 23:02:20 GMT

I still have a lonnnnnnngggg way to go to reach my goal of 775, but I'm inching closer each month that passes.

Thank you for the kind words.

I Wish you all the Best!!!