Amex Charge Card Balance

[Anonymous]

Couldn't find any specific info for this question but I currently have a large balance on my Amex Gold and my statement/cycle doesn't end until the 15th. I would like to pay it now but if I do it will report a $0 at that date. Are there any advantages to letting balances report on charge cards? I did notice on a few posts that your purchasing power is Xtimes your highest balance in the past 6 months etc. So I am trying to figure out what enhances my purchasing power on this card. Is it usage or statement balances?

[RicHowe]

There is no advantage.

AMEX being a closed loop system has sophiticated data analytics on each cardmember. They know how much you spend and how much you pay regardless of the balance at statement closing.

Showing a balance on a charge card will only increase your total debt (not your utilization) reported to credit bureaus and potentially affect your score.

The only caveat would be if your AMEX Gold was the ONLY card to report a balance. This would potentially affect the credit mix points of your score.

[HeavenOhio]

On an ongoing basis, there's no real advantage. There are a couple of caveats, though.

On my AMEX revolver, no "date of last activity" is reported. On another member's card, it is. When the date of last activity is reported, it's apparent that the card has been used, even if the reported balance is zero. If I want my AMEX card to look "used," I need to report a positive balance.

Also, the Experian FICO 98 family of scores attempts to include charge cards in the computation of utilization. Instead of one's limit, scoring uses one's highest balance. It's great to have a nice "high balance" for utilization purposes. But the downside to acquiring your high balance means that you have to put up with a maxed out card for a month for those three scores.

Experian 98 is important because it includes one of your mortgage scores. During the mortgage process, I think the smartest thing to do is to have all charge cards reporting zero.