Credi card usage

[Anonymous]

Is there any difference between having a $1.00 balance and a zero balance?  It may seem a silly question but I see advice many times on the board to keep all but one of your cards at zero balance and then only use one card for 35% utilization or less.  I, also, wonder if a zero balance causes the CCC to see you unfavorably.  Thanks in advance for your advice.

[grinlikechelsea]

It depends on the overall usage and available credit. If you use a card and pay it off before the statement cuts, the lender will see you favorably because you're using their card and paying them on time. However, when it reports to FICO, you will get dinged for not using your available credit. So in terms of banks, the a $0 balance isn't any different than a $1 balance when it reports, but it is optimal to let the $1 report so you can maximize your FICO score. I always let 1-10% of my available credit report, usually on one card.

[RaiseMyScoreASAP]

I have paid down accounts to $1 right before they report and three of the companies simply wrote off the $1 as a small balance write off and reported $0. I haven't tried $2. Most of my cards will however report $5. 

[NRB525]

Are you planning to apply for any credit soon? If not, there is not really enough difference in FICO score to micromanage the cards reporting. As long as you are PIF your cards, they are all in range to go to zero balance and leave one reporting something, if you want to optimize score.

My experience with most CCC is, they want you to use their card and pay them. Long term, this also builds your credit report, so there is no penalty for having amounts report. The only penalty is if you have too much outstanding, and the only serious penalty is if you don't pay on time.

Which cards do you have and how long have you had them? Early in your credit building days, you get more benefit just by participating, by stringing together month after month of good payments, than by worrying too much about optimization. Each new month of good payment helps your score, optimization may eek out a few more points.

[gdale6]

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@Anonymous wrote:

Is there any difference between having a $1.00 balance and a zero balance?  It may seem a silly question but I see advice many times on the board to keep all but one of your cards at zero balance and then only use one card for 35% utilization or less.  I, also, wonder if a zero balance causes the CCC to see you unfavorably.  Thanks in advance for your advice.

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0 revolving balances is a Fico score decrease you want 1 card reporting a small balance no more than 9% of its CL. There are some companies who will write off small balances as you have found out. I would suggest you let 10.00 report.