0% Apr and Effect on Fico

[Anonymous]

I think most people stress this "carrying a balance thing." Most people that have credit cards carry a balance. OP, you'll be fine.

[TRC_WA]

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@Anonymous wrote:
I think most people stress this "carrying a balance thing." Most people that have credit cards carry a balance. OP, you'll be fine.

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Totally agree... and stressing isn't necessary.

Every single dollar of my UTI is a 0% promotion.  Sure I could gain a few FICO points if I paid them off now but with 12-18 months at 0%... that's the kind of interest rate that makes it worth sacrificing a few FICO points.

Nothing wrong with carrying a balance.  I've let a couple cards report 80% UTI... I lost 2 points here and 3 points there. 

The world didn't end.

I got the points back when I paid down the accounts.

[Anonymous]

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@Anonymous wrote:

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@OmarGB9 wrote:
Yes you should really only worry about utilization when you DON'T have 0% offers available. But individual utilization is also taken into account, which should be kept under 30% at least. However, as long as you PIF or at least down to under 10% util by statement cut, you'll be fine.

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Is that for a single CC util or the total CC util?

EDIT : Or just use > 10% util on my AMEX and carry zero balance on other cards, and only pay min or slightly above min, will this strategy be ok too?

Thanks

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Take advantage of the interest-free money. Stop worrying so much about your score, it will recover when the balance is paid down, over time. 

For now, you should not be worried about your utilization so much - you should be happy with the money you're saving by paying no interest for several months. Even if you have the money to pay it, you should be keeping it in a savings account earning interest for now.

23% usage on a card with 0% APR is nothing to worry about. Neither is a higher usage. I probably wouldn't let it get to 80% on one card, but even if you did, as long as you're making reasonable payments, I wouldn't think you'd have an issue. 

Worrying about keeping your balance under 10% on a 0% APR card is just leaving money on the table. 

[OmarGB9]

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@Anonymous wrote:

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@OmarGB9 wrote:
Yes you should really only worry about utilization when you DON'T have 0% offers available. But individual utilization is also taken into account, which should be kept under 30% at least. However, as long as you PIF or at least down to under 10% util by statement cut, you'll be fine.

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Is that for a single CC util or the total CC util?

EDIT : Or just use > 10% util on my AMEX and carry zero balance on other cards, and only pay min or slightly above min, will this strategy be ok too?

Thanks

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Your edit is another good plan, except try to always pay more than the minimum whenever possible (it looks better to lenders).

[Anonymous]

wow guys, thank you, all good info here, this should be stickied, lol

[Imperfectfuture]

I actually have several 0% cards/promos going on right now. Spread across cards, I keep the balance reporting under 10%. But I let it sit there while paying off other cards that have ending dates sooner. I always pay at least twice the minimum payment.

For example, SimplyCash is easy, paid ahead on cell phone and cable, just charged an Alaska airlines flight. By paying what I normally would for cell phone and cable, add 50 for flight, card payed off when 0% ends November. BCE, a little under 500. Pay any new charges plus 80 (min payment 35). Paid off by January, when 0% ends. Letting around 450 float on Freedom, but always pay 50+ per month. Discover, plan to let 300 float (haven't got there yet. Currently paying 70 per month, even when no bill, min payment 35.

So you can keep using the cards, float a little for awhile. I have the money to pay all the current balances off, but it is sitting in several accounts right now, including investments. Quite happy to earn cash back or mileage, and still carry balances. To balance it, I let some cards report 0. Since I am gardening, the amount of balances showing doesn't hurt, and soft pulls by lenders (since most of this is new credit), aren't spooked.