topic Re: QUESTION, I want to keep my UTI approximately 9% and...... in Credit Cards

QUESTION, I want to keep my UTI approximately 9% and......

Anonymous — Sun, 29 Jul 2012 23:07:23 GMT

I hear, from this site, to make sure that when the CC reports the balance, have your one credit card (with the highest available credit limit) have a balance of 9%.

So, how do I find out THE DAY that the CC reports the balance? I have 4 revolving CC's and I would like to "test" and see what happens. I'd like to keep 3 of the 4 CC's with ZERO balance and place a 9% balance on the other card.

But, how do I determine when this CC reports that balance?

Thanks in advance

Re: QUESTION, I want to keep my UTI approximately 9% and......

Revelate — Sun, 29 Jul 2012 23:15:37 GMT

It's usually the balance as of your statement date, reported a few days after your statement close date, which can be determined either in an online interface or on the date given on the paper if you still receive non-electronic statements.

The only sticky point is it's not always statement close balance, sometimes it's the balance on the day the lender reports... further complicated by the fact that pending transactions may or may not get credited to your account in the meantime. So that's really where the advice comes in, zero out your other accounts well in advance, and then stay under that 10% or pre-pay it, or whatever required on your largest CL to make things easy.

That's probably the one reason I'll keep my BOFA checking account / card open long-term: it's so easy to manage for my non-zero balance compared to some other lenders I've read about here.

Edit: if you're really curious, keep track of your daily balance on your >$0 card, and use one of the free services like Credit Karma that allows you to see your report data easily, and match the amount up with your daily balance tracked otherwise. For your given lender, that'll basically demonstrate exactly what their policies are to make things as precise as possible going forward. Kinda gravy though for most folks, especially once you get things like charge cards which utilization isn't counted on for any modern FICO algorithm and just use that for your week-long float where you're tweaking balances.

Re: QUESTION, I want to keep my UTI approximately 9% and......

DaveSignal — Sun, 29 Jul 2012 23:13:36 GMT

Usually it is the statement date. Very occasionally, there are cards, such as Militar STAR, which reports at the beginning of the month, or other cards which do something else strange. But the majority of lenders will report to the credit bureaus on the statement date.

And it doesn't matter which card you choose to report a balance. Just that the one with a high credit limit is the easiest one to let report and be a small util % without thinking about it too much.

Re: QUESTION, I want to keep my UTI approximately 9% and......

Anonymous — Sun, 29 Jul 2012 23:20:19 GMT

So, if I have read this correctly, the credit card I have with the highest credit limit is $5000. 9% of that is $450.00 My Statement date is always the 14th. Therefore, for me to MAXIMIZE my FICO score.....

...I need to keep that balance ($450.00) on my account at my statement date which would mean I'd have to pay (gasp) interest on that $450.00, right? Is there anyway around paying that interest?

Seems like a crappy way to MAXIMIZE increasing a FICO score. Or, am I missing something?

Thanks

Re: QUESTION, I want to keep my UTI approximately 9% and......

Anonymous — Sun, 29 Jul 2012 23:24:22 GMT

I actually called all of my CC issuers and asked the date that they report to the bureaus. Most were able to give me the date that they report, some gave me a date range of 2-3 days.

Re: QUESTION, I want to keep my UTI approximately 9% and......

Anonymous — Sun, 29 Jul 2012 23:28:35 GMT

@Anonymous wrote:
So, if I have read this correctly, the credit card I have with the highest credit limit is $5000. 9% of that is $450.00 My Statement date is always the 14th. Therefore, for me to MAXIMIZE my FICO score.....

...I need to keep that balance ($450.00) on my account at my statement date which would mean I'd have to pay (gasp) interest on that $450.00, right? Is there anyway around paying that interest?

Seems like a crappy way to MAXIMIZE increasing a FICO score. Or, am I missing something?

Thanks

You don't pay any interest as long as you pay that 9% balance before the due date. I usually pay any balance several days after the statement closes.

Re: QUESTION, I want to keep my UTI approximately 9% and......

Cdnewmanpac — Sun, 29 Jul 2012 23:29:29 GMT

@Anonymous wrote:
So, if I have read this correctly, the credit card I have with the highest credit limit is $5000. 9% of that is $450.00 My Statement date is always the 14th. Therefore, for me to MAXIMIZE my FICO score.....

...I need to keep that balance ($450.00) on my account at my statement date which would mean I'd have to pay (gasp) interest on that $450.00, right? Is there anyway around paying that interest?

Seems like a crappy way to MAXIMIZE increasing a FICO score. Or, am I missing something?

Thanks

Not exactly. You pay interest on anything you do not pay in full by the due date, not the statement date. So, if you charge 450 today, on the 14th of august (per your post, or perhaps a few days later), you will get a statement indicating that you have a balance of 450, a minimum payment of x and a due date of (likely) 9/14. As long as you pay the balance IN FULL by 9/14, there is no interest due. So you want to pay off all your other charges on other cards BEFORE the statement is issued, so it issues a zero balance. What is on your statement (in most cases) is what is reported to the CRAs.

Re: QUESTION, I want to keep my UTI approximately 9% and......

DaveSignal — Sun, 29 Jul 2012 23:39:10 GMT

@Anonymous wrote:
So, if I have read this correctly, the credit card I have with the highest credit limit is $5000. 9% of that is $450.00 My Statement date is always the 14th. Therefore, for me to MAXIMIZE my FICO score.....

...I need to keep that balance ($450.00) on my account at my statement date which would mean I'd have to pay (gasp) interest on that $450.00, right? Is there anyway around paying that interest?

Seems like a crappy way to MAXIMIZE increasing a FICO score. Or, am I missing something?

Thanks

wrong. I NEVER pay interest. You get charged interest if you don't pay your full statement balance by the due date. Don't do that.

Just use the card continuously. Pay the full balance by the due date and then continue to use the card, but less than $450 before the statement hits. You don't get charged interest. You might want to read your disclosures that came with your credit card as they explain how interest is charged.

Re: QUESTION, I want to keep my UTI approximately 9% and......

Walt_K — Mon, 30 Jul 2012 01:10:00 GMT

+1 to everyone re paying the balance in full and avoiding interest.

Also, 9% isn't magical. Everyone has a different sweetspot, but lower is often better. You can just as easily let $5 post. You might have to play around with it if you're intersted in teasing out every last possible point.

Re: QUESTION, I want to keep my UTI approximately 9% and......

MarineVietVet — Mon, 30 Jul 2012 01:19:15 GMT

@Walt_K wrote:
+1 to everyone re paying the balance in full and avoiding interest.

Also, 9% isn't magical. Everyone has a different sweetspot, but lower is often better. You can just as easily let $5 post. You might have to play around with it if you're intersted in teasing out every last possible point.

I agree completely. Even $1 is enough.

Re: QUESTION, I want to keep my UTI approximately 9% and......

jamie123 — Mon, 30 Jul 2012 01:34:17 GMT

@DaveSignal wrote:

wrong. I NEVER pay interest. You get charged interest if you don't pay your full statement balance by the due date. Don't do that.

Just use the card continuously. Pay the full balance by the due date and then continue to use the card, but less than $450 before the statement hits. You don't get charged interest. You might want to read your disclosures that came with your credit card as they explain how interest is charged.

+1 What Dave said. Good advice!

It can be confusing though. Sometimes you need to pay twice in a month if you use the card heavily.

Let's walk through this with a few assumtions.

Statement cuts and reports on the 13th of August saying your balance is $449 (Which is just under 9% of your $5000 CL. Just where you want to be.) and payment is due September 10th.

Sometime BEFORE September 10th you need to pay at least $449 to have effectively PIF the previous month. Just for this example you pay $449 on August 21st. You have now insured that you will not pay interest on the $449 from the previous month. You have kept using this card regularly so at the point you pay the $449 your balance was actually $825. You don't care about that at the moment though you just want to insure that any interest charges are gone. That brings your balance down to $376. But you continue to use your card....

A few days before September 10th, say on September 7th, you need to make a decision. Your balance now stands at $625. Do you want to hit a certain percentage EXACTLY or is it okay to just be somewhere under 9%.

If the exact percentage isn't important, schedule a payment for $600 to leave a balance of $25. This gives you a cushion of $424 to be able to charge on the card until about 5 days after the due date of September 10th or your stement report date if you know EXACTLY when that will be. The statement report date is usually your due date or perhaps up to a few days after your due date.

If the EXACT percentage is important to you and say the dollar amount you need reported is $449 you would have to pay $176 on September 7th AND THEN SOCK DRAWER THAT CARD FOR A WEEK! You could then use another card that has already reported for the month or your debit card for a week.

That's why when thinking long term, 3 cards with high CLs are so attractive. After 1 card reports the less than 9% it becomes a zero reporting card the next month. You just rotate cards every month and things become much easier.

I hope that was clear enough?

Re: QUESTION, I want to keep my UTI approximately 9% and......

DaveSignal — Mon, 30 Jul 2012 02:01:58 GMT

jamie: great way to explain it!

That rotating cards thing is a bit too complicated for me, however. I, personally, just shoot for the range of somewhere between 0 and 10%.

Re: QUESTION, I want to keep my UTI approximately 9% and......

Anonymous — Mon, 30 Jul 2012 13:52:57 GMT

Thanks for all the responses. Appreciated.