topic Re: Help! Reported Balances in Credit Cards

Help! Reported Balances

Anonymous — Sun, 01 Jul 2012 22:45:08 GMT

From reading the forums I have come to the conclusion that generally, if one has multiple revolving credit accounts, producing the best CS will result in having one CC report <9% utl, while other CCs report a $0 balance.

If I practice this method and I ALWAYS USE THE SAME CCs to report a $0 balance over the course of lets say, 3 to 6 to 9 months to a year. What kind of affect will this have on my CS.

Assuming all cards are showing activity in regard to the CCCs.

Re: Help! Reported Balances

Cdnewmanpac — Sun, 01 Jul 2012 22:59:23 GMT

The effect of utilization on score is not cumulative. Your utilization this month does not influence your score in later months. While having only one card report a balance (and that balance between 5-9%) should maximize the utilization component of your score, having done the same thing for the previous year (or whatever time you pick) wont give any additional boost.

Re: Help! Reported Balances

Anonymous — Sun, 01 Jul 2012 23:42:47 GMT

I was thinking in terms of only one account showing activity on my CR. Is this a bad thing? Or does it even matter?

Re: Help! Reported Balances

Revelate — Sun, 01 Jul 2012 23:59:58 GMT

@Anonymous wrote:
I was thinking in terms of only one account showing activity on my CR. Is this a bad thing? Or does it even matter?

Having a balance of $0 month to month isn't the same as an inactive card. Personally I don't risk it though and unless I'm apping for something, I leave some random amount of a few bucks and shrapnel on each and go on with life. Some older analysis might assume an unchanging balance is inactivity; however, payments made in a month do get reported to the bureaus, so FICO is certainly sophisticated enough to see whether a card is inactive or not from that measure.

The only issue I've found with an unchanging balance, is sometimes it gets lost in the lender reporting for any given month (Discover seems to be prone to this especially) but I've had it happen personally with BOFA before. As a result, I just vary my balances and haven't seen it be an issue across any of my tradelines... but also I charge a little something even on a card I really don't use, every month. That's probably overkill, but it works for me.

Re: Help! Reported Balances

Anonymous — Mon, 02 Jul 2012 00:33:55 GMT

@Revelate wrote:
@Anonymous wrote:
I was thinking in terms of only one account showing activity on my CR. Is this a bad thing? Or does it even matter?
Having a balance of $0 month to month isn't the same as an inactive card. Personally I don't risk it though and unless I'm apping for something, I leave some random amount of a few bucks and shrapnel on each and go on with life. Some older analysis might assume an unchanging balance is inactivity; however, payments made in a month do get reported to the bureaus, so FICO is certainly sophisticated enough to see whether a card is inactive or not from that measure.

The only issue I've found with an unchanging balance, is sometimes it gets lost in the lender reporting for any given month (Discover seems to be prone to this especially) but I've had it happen personally with BOFA before. As a result, I just vary my balances and haven't seen it be an issue across any of my tradelines... but also I charge a little something even on a card I really don't use, every month. That's probably overkill, but it works for me.

I see, I wouldnt call it overkill. Better safe than sorry! Thanks for the help!

Re: Help! Reported Balances

jsucool76 — Mon, 02 Jul 2012 00:44:56 GMT

Not to hijack your thread, but...

I have only one card, would it be better to carry a small balance ($5-$10) ? or would I be better off paying to a $0 balance every month?

Re: Help! Reported Balances

Anonymous — Mon, 02 Jul 2012 01:07:10 GMT

@jsucool76 wrote:
Not to hijack your thread, but...
I have only one card, would it be better to carry a small balance ($5-$10) ? or would I be better off paying to a $0 balance every month?

With a CL of $3000. I would say it would be best to let your statement post with $270 or less. That way you would be utilizing 9% or less of your available credit. This is ideal based on what I've read. Then when your credit card company asks for a minimum payment. Pay in full to avoid interest.

Hope this helps!

Re: Help! Reported Balances

jsucool76 — Mon, 02 Jul 2012 01:12:21 GMT

Thank you kindly for the info. Credit isn't as easy to handle as some of these high rollers make it seem.

Re: Help! Reported Balances

Middleswarth — Mon, 02 Jul 2012 03:50:37 GMT

@jsucool76 wrote:
Thank you kindly for the info. Credit isn't as easy to handle as some of these high rollers make it seem.

I think it is easy when you are not apping for cards or other loans. Your FICO does not have to be at its peak all the time. IMO, as long as the bills are paid don't worry about maxing your score.