About using 0% apr

[Anonymous]

---

@Closingracer99 wrote:

---

@Anonymous wrote:

If you only make minimum payments for the duration of the 0% offer, your utilization will increase which will likely drive your scores down a bit. But if you keep track of things well, you can make some extra money as you describe. That's essentially what banks do with the money we deposit.

---

Your utilization can't rise if you're taking advantage of a 0% APR if you're only paying the min.... Since there is no interest and you're paying down the debt your Util will go down not up....

---

You must be presuming he's going to charge all $20k in the first month and then pay it off over the life of the 0% APR.  From what the OP said, he plans to just use the card for purchases every month, slowly building up to as much as $20k before the end of the period.  Thus, his utilization will increase over time, not decrease.

I did this very thing when I signed up for the Discover it  Miles card last year.  Kept putting most everthing on it and paying the minimum each month.  Got a comple of CLI's along the way when I approached (or exceeded) the C/L.  I saw no adverse action, but I did see my score drop from around 840 to around 760.  Finally paid it off last month, and my scores bounced right back.

Chris.

[Anonymous]

---

@Anonymous wrote:

---

@Closingracer99 wrote:

---

@Anonymous wrote:

If you only make minimum payments for the duration of the 0% offer, your utilization will increase which will likely drive your scores down a bit. But if you keep track of things well, you can make some extra money as you describe. That's essentially what banks do with the money we deposit.

---

Your utilization can't rise if you're taking advantage of a 0% APR if you're only paying the min.... Since there is no interest and you're paying down the debt your Util will go down not up....

---

You must be presuming he's going to charge all $20k in the first month and then pay it off over the life of the 0% APR.  From what the OP said, he plans to just use the card for purchases every month, slowly building up to as much as $20k before the end of the period.  Thus, his utilization will increase over time, not decrease.

I did this very thing when I signed up for the Discover it  Miles card last year.  Kept putting most everthing on it and paying the minimum each month.  Got a comple of CLI's along the way when I approached (or exceeded) the C/L.  I saw no adverse action, but I did see my score drop from around 840 to around 760.  Finally paid it off last month, and my scores bounced right back.

Chris.

---

Yes , that's the plan. Did your score bounced back to 840 again ?

[Anonymous]

---

@Anonymous wrote:

---

@Anonymous wrote:

---

@Closingracer99 wrote:

---

@Anonymous wrote:

If you only make minimum payments for the duration of the 0% offer, your utilization will increase which will likely drive your scores down a bit. But if you keep track of things well, you can make some extra money as you describe. That's essentially what banks do with the money we deposit.

---

Your utilization can't rise if you're taking advantage of a 0% APR if you're only paying the min.... Since there is no interest and you're paying down the debt your Util will go down not up....

---

You must be presuming he's going to charge all $20k in the first month and then pay it off over the life of the 0% APR.  From what the OP said, he plans to just use the card for purchases every month, slowly building up to as much as $20k before the end of the period.  Thus, his utilization will increase over time, not decrease.

I did this very thing when I signed up for the Discover it  Miles card last year.  Kept putting most everthing on it and paying the minimum each month.  Got a comple of CLI's along the way when I approached (or exceeded) the C/L.  I saw no adverse action, but I did see my score drop from around 840 to around 760.  Finally paid it off last month, and my scores bounced right back.

Chris.

---

Yes , that's the plan. Did your score bounced back to 840 again ?

---

Ish.  Certainly over 800, but more like 820.  I saw a few more cards to apply for and couldn't resist, which has driven up my inquiries and down my AAOA.  But what's the use of a 800+ credit score if you're not going to exploit it?

Chris.

[Anonymous]

No, I wouln't.

You have a great group of cards that you probably plan to keep for a long while excluding a few probably.  Remember your profile is relatively young.  Also take into consideration that util is more than 'overall'.  Lenders seeing you use 50+ % util on one particular card (or any other high %) might lead to AA.  Also nominal overall debt plays a factor.  When I see AA threads and people screaming 'my util was only 10% or was less than 30% etc) but remember if you're $10,000 in debt you're $10,000 in debt.  That's a significant amount of money, no matter what your available credit is.  Without special knowledge to the contrary that says that your income is not sufficient to meet your spending pattern and you've borrowed $10,000.  What are the chances you're able to right the ship and pay all of that back?  Decent probablby, given your scores and history.. but still risky enough for them to notice.

Now if the interest rate was 10% in savings I would say ya to hell with any AA go ahead and do it.  But in this case I think the ongoing positive relationships with these banks and your revolving credit lines is more valuable than 1% interest in a savings account.  I mean if you want to revolve a few thousand on one of the cards while still making 10+% of the balance payments every month sure go ahead and do it.  But aggressively loading up balances on these cards and min paying until the last minute then PIF?  Not worth it.  Set them up for the long con and burn them for 150k down the line in a BK (just kidding)