CREDIT UTILIZATION QUESTION AND HELP?

[bsal]

OK GUYS I'M KIND OF CONFUSE AND I NEED A LITTLE HELP WITH THIS I UNDERSTAND CREDIT UTILIZATION IS BALANCE/ CREDIT LIMIT * 100 BUT MY QUESTION IS THIS I'M GOING TO BE RECIVING MY FIRST SECURED CARD OF 1000.00 FROM PENFED NOW IF I SPEND 300.00 ON THE CARD ARE U GUYS SAYING I'M GOING TO HAVE TO PAY 200.00 DOLLARS BEFORE I GET MY ACTUAL BILL IN THE MAIL TO KEEP MY UTILIZATION JUST AT 10%? AND WHEN I GET THE BILL IN THE MAIL JUST PAY IT OFF OR AM I SUPOSE TO JUST LEAVE A BALANCE I'M CONFUSED CAN SOMEBODY HELP ME AND LET ME KNOW IF I'M DOING IT RIGHT?

[bsal]

ANY ADVISE ON THIS?

[Anonymous]

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bsal wrote:

OK GUYS I'M KIND OF CONFUSE AND I NEED A LITTLE HELP WITH THIS I UNDERSTAND CREDIT UTILIZATION IS BALANCE/ CREDIT LIMIT * 100 BUT MY QUESTION IS THIS I'M GOING TO BE RECIVING MY FIRST SECURED CARD OF 1000.00 FROM PENFED NOW IF I SPEND 300.00 ON THE CARD ARE U GUYS SAYING I'M GOING TO HAVE TO PAY 200.00 DOLLARS BEFORE I GET MY ACTUAL BILL IN THE MAIL TO KEEP MY UTILIZATION JUST AT 10%? AND WHEN I GET THE BILL IN THE MAIL JUST PAY IT OFF OR AM I SUPOSE TO JUST LEAVE A BALANCE I'M CONFUSED CAN SOMEBODY HELP ME AND LET ME KNOW IF I'M DOING IT RIGHT?

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Just a friendly reminder that all caps are hard to read, and are considered to be shouting on Internet forums.  Please turn your caps lock off in future posts.

Yes, you are correct that if you have a $1000 CL and spend $300, you will have to pay $200 before the statement cuts (not just before you get the bill in the mail, but before the actual statement date) in order to let 10% report.

Once the statement cuts, however, you will still have to pay the minimum monthly payment by the due date to avoid making a late payment.

Hope that helps.

[bsal]

sorry for the all caps chedder and yes it helped but forgive me for this dumb question but what do u mean before the statement cuts? how will i know when the statement cuts?

[Anonymous]

U will get a billing statement! or you can call Customer service and ask when is your next statement!

[Anonymous]

Utilization is not a running total, but rather a "snapshot" of your balances versus your credit limits that is taken right around the time your statement is cut.

This is why simply charging up a high balance at a given moment in time doesn't mean your utilization is necessarily shot, nor does paying your balance down in and of itself immediately reduce utilization. Rather, the balance and CL at the time your statement cuts is what is generally reported.

Next time you get a statement, check the date (usually in the upper right corner).

[Zar]

I have a question... what about if someone has five cards and very small balances (less than 9%) on three or four of them? Does it hurt the FiCO or how a potential lender sees that person?

Zar

Message Edited by Zar on 06-15-2008 05:05 PM

[Anonymous]

No Zar, to the contrary, you're helping your FICO by having five positive TLs reporting in good standing.

Now if you want to split hairs, technically, to get the absolute most for your FICO score, you would want less than half those cards to report balances at all. But that's serious, 2 to 3 point nitpicking. You're doing a wonderful job. Pat yourself on the back.

[Zar]

Thank you very much TheNewWorldMan! I'm learning a lot here!

Zar

[bsal]

ok you just lost me on everything you just said i'm going to need you to dumb it down for me please i'm new to this