topic Re: Dumb question sorry in Credit Cards

Dumb question sorry

Anonymous — Wed, 12 Sep 2012 01:32:36 GMT

Ok I have a bank of America cash rewards 123 card with a 1500 limit I use it a lot close to the limit and pay it off every month and do the same thing every month but this isn't looking good on my credit what am I doing wrong? Thank you in advance

Re: Dumb question sorry

gettnthere — Wed, 12 Sep 2012 01:34:25 GMT

@Anonymous wrote:
Ok I have a bank of America cash rewards 123 card with a 1500 limit I use it a lot close to the limit and pay it off every month and do the same thing every month but this isn't looking good on my credit what am I doing wrong? Thank you in advance

you say you pay in full every month right? do you PIF on the due date or before the statement close date?

Re: Dumb question sorry

Anonymous — Wed, 12 Sep 2012 01:36:31 GMT

I pay a couple days before the bills is due every month on the 12th

Re: Dumb question sorry

jamesdwi — Wed, 12 Sep 2012 01:37:46 GMT

@Anonymous wrote:
Ok I have a bank of America cash rewards 123 card with a 1500 limit I use it a lot close to the limit and pay it off every month and do the same thing every month but this isn't looking good on my credit what am I doing wrong? Thank you in advance

Pay In Full before the statement cuts, then it reports zero on your credit reports. Letting the card report over 90% of its limit is maxing it out and is a sign that aren't using your credit wisely.

If you plan on doing the same every month, you should look into getting a charge card, for example AMEX Zync with good credit you get No Preset Limit, and it grows with you. You do have a limit but its not reported, so you can use the card as much as your income allows, and pay it off every month. If it reports it doesn't matter its not counted in your utilization, because it has to be paid off every month.

Welcome to the Forums.

Re: Dumb question sorry

Anonymous — Wed, 12 Sep 2012 01:38:04 GMT

it doesn't matter as long as you pay it on time each month... if you decide to apply for new credit pay it in full before the statement closes so it reports a zero balance for the highest possible fico score

hope that help

Re: Dumb question sorry

bichonmom — Wed, 12 Sep 2012 01:42:15 GMT

@Anonymous wrote:
Ok I have a bank of America cash rewards 123 card with a 1500 limit I use it a lot close to the limit and pay it off every month and do the same thing every month but this isn't looking good on my credit what am I doing wrong? Thank you in advance

The problem is that you're paying by the due date, but since the statement balance reports to the CRAs, it looks like you're maxed out. Unfortunately, FICO doesn't distinguish between a CC that has a high balance with a small pmt paying on it monthly, and when you charge up the CC and PIF each month.

That's why many people here PIF their stmt BEFORE it cuts. This would end up being a few weeks before your due date. So, if your stmt cuts on the 15th, let's say. Then you go online and pay the balance on the 13th or 14th, and be sure not to use the card until after the 15th. Then when your statement cuts, the bal w/be zero, and that will be reported to the CRAs.

It may not make a lot of sense, but that's the way FICO works. If you do that, and your overall CR is in good shape (no baddies, lates, etc.), then you would probably be able to CLI. If you're going to charge and PIF $1500 a month, ideallly, you want your CL to be around $10 to 15000. That way, when your statement cuts WITH the balance of $1500, it's only around 10% of your total CL. That won't have nearly the effect on your FICO as it does now. You may not get $10k from $1500, but that would be the eventual goal.

Re: Dumb question sorry

Anonymous — Wed, 12 Sep 2012 01:46:44 GMT

ItIt's says my statement close date is the 15 th so it closes three days after its due if my balance was at zero on te 15 iwouldjust have to make it at zero on oct 15th again even though I use it all month it would report zero and help my score

Re: Dumb question sorry

jamesdwi — Wed, 12 Sep 2012 01:49:01 GMT

@Anonymous wrote:
ItIt's says my statement close date is the 15 th so it closes three days after its due if my balance was at zero on te 15 iwouldjust have to make it at zero on oct 15th again even though I use it all month it would report zero and help my score

pay it down to zero on the 13th or 14th, and then it will report zero to the Credit Reports. This is one of the reason people carry more than one card, so they can switch to another card the day or two before there statement closes.

Re: Dumb question sorry

Anonymous — Wed, 12 Sep 2012 02:16:17 GMT

Ok this will help thank you for all the help

Re: Dumb question sorry

youngandcreditwrthy — Wed, 12 Sep 2012 03:44:03 GMT

You need a higher credit limit to lower reported utilization ... maybe to add an extra card or two. Looking maxed out is BAD!!!
Best of luck:-)