topic Re: What's the point of High Balance? in Credit Cards

What's the point of High Balance?

mxp114 — Mon, 26 Sep 2011 23:33:49 GMT

Does anyone know? I used to think it was there to show potential lenders how much debt you can run up and your ability to pay it. For example a $0 balance today with a HB of $20,000 is excellent because it demonstrates your ability to repay $20k. Is that correct or does it not serve any specific purpose? I've always wondered. Thanks.

Re: What's the point of High Balance?

AndySoCal — Tue, 27 Sep 2011 02:31:37 GMT

It is simply the highest balance that the account has ever reached. I am not how a lender uses it. I would try to keep the high balance under your credit limit.

Re: What's the point of High Balance?

CS800 — Tue, 27 Sep 2011 02:44:47 GMT

@AndySoCal wrote:
It is simply the highest balance that the account has ever reached. I am not how a lender uses it. I would try to keep the high balance under your credit limit.

That's assuming you know your CL. If you have the Zync, there is no limit on it. So how can one know what's the CL on a charge card?

Re: What's the point of High Balance?

Anonymous — Tue, 27 Sep 2011 03:36:45 GMT

@CS800 wrote:
@AndySoCal wrote:
It is simply the highest balance that the account has ever reached. I am not how a lender uses it. I would try to keep the high balance under your credit limit.
That's assuming you know your CL. If you have the Zync, there is no limit on it. So how can one know what's the CL on a charge card?

Spend until your card gets denied

I'm willing to bet that the "benefit(s)" of your high balance are not worth going out of your way to charge up 99.9% of your CL once just so your CR shows a high high balance.

Re: What's the point of High Balance?

Anonymous — Tue, 27 Sep 2011 04:44:07 GMT

Re: What's the point of High Balance?

CS800 — Tue, 27 Sep 2011 13:03:52 GMT

If a charge card does have a limit, it would be good to know since for points purposes, I would charge all the utilities on it and pay it off in full before the period ends.

I just dont want to run the risk of putting my utilities on it and then it gets denied becasue it has reached a limit.

Re: What's the point of High Balance?

Anonymous — Tue, 27 Sep 2011 21:53:24 GMT

I'm sure you could call and ask them if there is a limit. Although, unless you have extremely expensive utility bills, I doubt you would hit your limit. I would assume a "limit" on a charge card would be at least $10k.

Re: What's the point of High Balance?

thebanjoman — Tue, 27 Sep 2011 23:31:41 GMT

@AndySoCal wrote:
It is simply the highest balance that the account has ever reached. I am not how a lender uses it. I would try to keep the high balance under your credit limit.

I'd agree to keep it under your CL, but in the case of CLDs, i'm not sure you can always keep it under a present CL. High balance seems to be an "all time" not "recent".

While I believe TU98 uses it as a proxy for a credit limit where NPSL's are in effect, but newer FICO calcs don't. There's no real telling what model a lendor will use, or how a lendor will internally adjust/modify/recalculate/so on... I'd lump "High Balance" in with the >1 year old inquiries that don't really affect your FICO score, but still seem to have some value in tracking and publishing on a credit report. I personally just try to keep any cards from only reporting a high balance of $0.00, for fear some application score/other modified or altered model will ding/ignore that trade line. (Which is clearly not a FICO based fear however. Nor derived from FAKOs, just a general sense fear based around the thought that if i were a lendor, I'd question how well managed a "never used" line really is).

Re: What's the point of High Balance?

tntexans72 — Wed, 28 Sep 2011 00:21:58 GMT

What's the big deal with NPSL CCs?

Re: What's the point of High Balance?

CS800 — Wed, 28 Sep 2011 00:45:29 GMT

I called AMEX on my Zync to see if I had a CL and the agent said that I didnt have a liimt. Now i'm confused. I thought even though it;s a charge card, it had a limit.

So the agfent said as i was on the phonew with him to try the 'spending' option on my Zync and I put $5000 and it said it was approved. (not that i will even spend 1/3 of that amount )

Re: What's the point of High Balance?

AndySoCal — Wed, 28 Sep 2011 02:06:56 GMT

A charge card the balance is due full each month. So it does not factor into the FICO credit util calc. Charge cards use a different term something like credit line instead of credit limit.

Re: What's the point of High Balance?

Anonymous — Wed, 28 Sep 2011 02:18:10 GMT

@CS800 wrote:
I called AMEX on my Zync to see if I had a CL and the agent said that I didnt have a liimt. Now i'm confused. I thought even though it;s a charge card, it had a limit.

So the agfent said as i was on the phonew with him to try the 'spending' option on my Zync and I put $5000 and it said it was approved. (not that i will even spend 1/3 of that amount )

There isn't a preset spending limit, but I think some members here have gotten the card denied at some high spending point

Re: What's the point of High Balance?

score_building — Wed, 28 Sep 2011 03:03:39 GMT

@Anonymous wrote:
I'm sure you could call and ask them if there is a limit. Although, unless you have extremely expensive utility bills, I doubt you would hit your limit. I would assume a "limit" on a charge card would be at least $10k.

Not sure where that assumption comes from but it is not the case, an internal limit on a charge product varies and could be considerably less than 10k.