Carrying Balances

dbatl14 · ‎08-08-2015

I am still quite confused on this. Of course where ever you read it always says "PIF" we all understand that. BUT I know a few people that carried some signifcant balances but got nice CLI's, great rates, and good cards even though they keep carrying balances.

I have conditioned myself to always PIF but yet I have a few cards that give you the 0% promo and what's the point of 0% APR if you don't use it, I may want to make large purchases but pay over 3 - 6 months or even more. Keep my cash as long as I can.

Do any of you have insight, advice, do's and don'ts

Or if you start leveraging balances do you shoot yourself in the foot with the banks. I am not trying to make this a habit but I am deciding to make a fairly large purchase in the near future but been hesitant because of it. Amex gave me 0% APR until next November but it is fairly new don't want to get too high of utilization either.

So I have been toying around with a few strategies, where my BofA has the highest limit, but my Barclay offers a 0% BT for the November. I was think charging it on my BofA and then transfering majority of it to Barclay and pay off BofA.

Also should I put something big on my Amex Charge Card because the utilization doesn't play a factor and they have the POT feature now.

Any good advice out there?

gdale6 · ‎08-08-2015

I have taken 0% financing offers right to 89% of an accounts CL without ever hearing a peep out of the bank, I always make more than the minimum payment though while under a 0% offer rule of thumb is 2x minimum. There are some banks that I would pay back more quickly and Amex is one of them from what I have read on these forums over the years. You just dont want to take every card you have and put a balance on it and have it report such to the CRAs. The more establlished your credit file is and the higher your score the easier it is to run higher balances in relation to a cards limit with good financing offers. I personally have never received AA from doing so and I will also add at no time did my overall util exceed 50% of total credit available, now I rarely hit 8% overall even using such offers.

NRB525 · ‎08-08-2015

OP, the point of getting a credit card, or any loan, is to at some point enable you to pay more than you have in cash right now to buy something, and then to pay that something off over time. If you've got a 0% APR offer, take it. Pay more than the minimum, and ideally time the payments so at the expiration of the 0% period, you've got it paid off.

In my case, paying down large balances, I have no problem moving balances out of one account that had a 0% or low APR expire, move it to another card, then move it back to the same old account with a new 0% or low APR offer. The more you do this, the more the banks get used to seeing you do this, and the more comfortable YOU get with doing it. It's best to try to save money on interest payments whereever you can.

The advice to not carry balances is good, because that avoids interest costs. Life happens, and sometimes we end up with balances to pay over time.