topic Re: If you max a card then PIF on the next cycle; long term damage? in Understanding FICO® Scoring

If you max a card then PIF on the next cycle; long term damage?

webhopper — Sun, 22 Jul 2012 03:19:27 GMT

Does it do any long term damage to Ficos if you Max a card out and then pay in full next cycle?

Re: If you max a card then PIF on the next cycle; long term damage?

MarineVietVet — Sun, 22 Jul 2012 03:22:40 GMT

@webhopper wrote:
Does it do any long term damage to Ficos if you Max a card out and then pay in full next cycle?

Scoring won't care because the utilization will go back down after paying in full but that particular creditor might get a bit nervous and wonder why you maxed out the limit.

Re: If you max a card then PIF on the next cycle; long term damage?

compassion101 — Sun, 22 Jul 2012 03:30:22 GMT

No long term damage. The portion of your score that varies based upon utilization has no memory.

Theoretically a company could check your balance history month-to-month as reported on Experian (not sure if TU ans EQ report balance histories) but I doubt they do that unless it is some specific credit scrutinization.

Re: If you max a card then PIF on the next cycle; long term damage?

Anonymous — Sun, 22 Jul 2012 04:16:00 GMT

Just make sure your PIF a couple days before the Statement date and not necessarily the due date so that whe it reports on your credit the balance is reported Zero!

Re: If you max a card then PIF on the next cycle; long term damage?

compassion101 — Sun, 22 Jul 2012 04:32:51 GMT

@Anonymous wrote:
Just make sure your PIF a couple days before the Statement date and not necessarily the due date so that whe it reports on your credit the balance is reported Zero!

I think he is only concerned about long term damage. In which case no need to pay beore the statement date iv he isn't applying or credit this month.

Re: If you max a card then PIF on the next cycle; long term damage?

webhopper — Sun, 22 Jul 2012 13:20:13 GMT

I had maxed my discover card. Its been open since 99. I had a BT promote that I took advantage of as well as a cruise through shopdiscover. I'm fairly certain discover isn't going to take AA on a card that's been open since 1999 with no late pays. Ive also maxed the card out in the past to use for reimbursed travel and lodging expenses.

The reason I asked is because I was browsing the auto forums and someone advised a guy to apply for an auto refi "as long as he hadn't had late payments or Max a card in the last year"

I thought they was odd but I wanted to bring the topic here to make sure I wasn't missing anything.

My discover was maxed march; PIF in may. Then maxed again at the end of may and PIF in July.

I knew I would be using the full limit on the card; so I called and asked for a CLI but they couldn't do it without a HP.

We had bought a new house in January; done a 4k septic repair in April; married in may; Alaskan cruise for three in June. I guess we've been living larger than life but we.actually had about 4 major life events within a 6 month time period. I'm glad things are semi Back to normal. We had the income and savings to support all of this activity; but you have to admit that maxing out a 4200 card and paying off completely twice is a little unusual

Re: If you max a card then PIF on the next cycle; long term damage?

Revelate — Sun, 22 Jul 2012 14:23:20 GMT

WH: You know to take everyone's comments with a grain of salt on this forum .

I'll have to go look for that one but the others are correct: FICO itself has no memory when it comes to the revolving utilization calculation. Underwriting could see a high balance and aggregate payment and might ask (incredibly doubtful assuming you paid it, credit cards are designed for short-term float just like you used it) but if they do, just explain exactly what you said here on this forum. No big deal.

Edit: that's for auto-loan underwriting where it's almost guarunteed to be a wash if noticed at all; credit card app, it'd probably be viewed as a straight positive in underwriting... people who use their cards make lenders money.

Re: If you max a card then PIF on the next cycle; long term damage?

webhopper — Sun, 22 Jul 2012 14:39:23 GMT

I'm going to be applying for a mortgage refi. The lender is already aware that I maxed my card because I wouldn't let the LO pull credit until that balance was paid off. She said I probably qualified despite the score drop but I'm very close to the top tier rates and for a 30 yr mortgage; the difference in rates would cost me about 10k over the life of the loan. I told her the card was maxed due to the wedding. Haha she wanted to pull credit anyways. I have my reports frozen; but I will unfreeze them after balances update

Re: If you max a card then PIF on the next cycle; long term damage?

Revelate — Sun, 22 Jul 2012 14:57:12 GMT

You worry way too much WH . You'll be absolutely fine, you know what's up credit-wise.

Re: If you max a card then PIF on the next cycle; long term damage?

webhopper — Sun, 22 Jul 2012 20:16:09 GMT

Thanks for the input guys. My husband tells me the same thing; that I worry way too much.

Re: If you max a card then PIF on the next cycle; long term damage?

cashnocredit — Tue, 31 Jul 2012 04:28:29 GMT

@webhopper wrote:
I had maxed my discover card. Its been open since 99. I had a BT promote that I took advantage of as well as a cruise through shopdiscover. I'm fairly certain discover isn't going to take AA on a card that's been open since 1999 with no late pays. Ive also maxed the card out in the past to use for reimbursed travel and lodging expenses.

The reason I asked is because I was browsing the auto forums and someone advised a guy to apply for an auto refi "as long as he hadn't had late payments or Max a card in the last year"

I thought they was odd but I wanted to bring the topic here to make sure I wasn't missing anything.

My discover was maxed march; PIF in may. Then maxed again at the end of may and PIF in July.

I knew I would be using the full limit on the card; so I called and asked for a CLI but they couldn't do it without a HP.

We had bought a new house in January; done a 4k septic repair in April; married in may; Alaskan cruise for three in June. I guess we've been living larger than life but we.actually had about 4 major life events within a 6 month time period. I'm glad things are semi Back to normal. We had the income and savings to support all of this activity; but you have to admit that maxing out a 4200 card and paying off completely twice is a little unusual

Hey, that's the best way in the world to use credit cards.

It probably does wonders for your "Capacity Index" FICO score. It's an indicator of your capacity to take on additional debt. Helps with CLIs and high limits opening new accounts. It's an important adjunct score to the basic FICO risk score.

And congratulations!