I've always let a high balance report and I always will.
It's all anecdotal but I'm pretty sure it's played a non-trivial factor in driving my CSP approval at 22K, and the rest of my limits have followed that first step by Chase. 8.9K/9K on the BCP, and 11.2K on the Zync, heck I even have a high balance above the current limit on my BOFA nee secured card, nobody has cared, my only denial other than a CLI back in the day has been as a result of 5/24.
It doesn't matter FICO wise (has no memory) past some interstitial month and not even that when talking say Chase, and I want to show every other lender, not just the one that I'm at, that I can pay off a large balance. Remember this is what credit cards as an entire product class were designed for: short term float. Heck, actually in the days of NPSL cards not reporting limits, you always maxxed out your card for a month, got the HB, because then you actually had a proper limit for scoring purposes.
TBH I've never understood how collectively skittish we are about high balances, and inquiries, and certain other things... if the rest of your financial and credit life is in order, even if you're an ugly file like I've been during my entire tenure on this forum, lenders aren't going to take AA against you in the current credit market.
Quite the contrary, go go CLI justification or limit extension when we're talking high balances.
To be fair I grew up in the cloudy skies leading to sunshine credit market, way after the thunderstorms at midnight of the mortgage crisis... but it's still sunny in candy, er, credit land.
Also, and this is a bit cynical, your credit report is not only measured for risk, it's looked at for profitability which kinda go hand in hand... high balance = I spend, you (lender) win, credit gimme!
@Anonymous wrote:Remember that whatever the highest amount is that you allow report on any given card will forever be visible on your credit report under "high balance." Showing a "high balance" of near the credit limit of a card (maxed out) only suggests to anyone looking at your report that you may again max out the card or another card, which can only be seen as a liability.
OP intends to PIF by the due date.
The only baddies in credit reporting are from some variation of "cardholder did not pay according to terms."
In answer to the OP original question, yes, in the long run it is good to max out a card now and then. It impacts FICO score short term, but that recovers with utilization management. Letting all lenders see you borrow and pay is the whole purpose of your credit report.
The only absolute requirement in credit is to pay at least the minimum payment on time. Everything else is a tactical choice of how to use that credit.
(In the long run, Highest Balance cannot be compared to any credit limit since there is not a direct time stamp telling when the high balance occurred. Credit limits change over time, both up and down. I've got more than a few accounts where the historical high balance is in the $10,000 - $20,000+ area, but balance chasing brought the current limits down well below that. Does not have any negative influence on my ability to get credit because I have always made at least the minimum payment on time. )
Balance = everyone sees it.
PIF before statement = one lender sees it.
If you want an interesting market research project, look at Amex and Chase approvals from 2012-2014: they played leapfrog on plenty of people's reports to the point I doubt there wasn't some attempt at takeaways between the two.
Also AA is another thing that is blown way out of proportion on this forum: even with my middle tier credit scores I am not going to have to start over at secured land even if every lender takes collective AA against me... and the likelihood of that is near zero.
I could manage my life again on 2K limits if I had to and the odds that I'd get airstruck below 20k even is incredibly remote: AA, ain't skeered.
I haven't looked at the examples in depth I will admit, but I kinda doubt the high balances in question were all the one month and PIF variety as I am advocating.
End of the day people will do what they want, but in my opinion as long as they are transacting the banks don't care what your month to month balances are.
PIF before statement = one lender sees it.
If you want an interesting market research project, look at Amex and Chase approvals from 2012-2014: they played leapfrog on plenty of people's reports to the point I doubt there wasn't some attempt at takeaways between the two.
Also AA is another thing that is blown way out of proportion on this forum: even with my middle tier credit scores I am not going to have to start over at secured land even if every lender takes collective AA against me... and the likelihood of that is near zero.
I could manage my life again on 2K limits if I had to and the odds that I'd get airstruck below 20k even is incredibly remote: AA, ain't skeered.
I haven't looked at the examples in depth I will admit, but I kinda doubt the high balances in question were all the one month and PIF variety as I am advocating.
End of the day people will do what they want, but in my opinion as long as they are transacting the banks don't care what your month to month balances are.
@Anonymous wrote:But Rev, whats the benefit of allowing a maxed out balance to report? Hoping that a different lender will see it and play joust?
Examples have already been given, not just throughout this board but in this thread alone where people have seen AA as a result of maxing out a card. To me, it just seems like an unnecessary risk for little to no reward. I'll admit that I've never done this, so there's a possiblity that I'm missing something completely obvious here as I've never been in these shoes before.
Repeating myself but yes, it's a profitability analysis as well as a risk one.
Since you're familiar with the threads and I admit I don't read this particular board nearly as much as I used to, see what other factors were in play. I've maxxed out Amex, Chase, Discover, BOFA all at various points, we're talking a lot of times actually during my credit career and there are many others that have too... way more than the incidences of AA.
Maxxing out individidul limits transiently is a pretty typical consumer behavior, banks get worried when those balances are just hanging out... and when that happens, or BT's which set high balances, or some other awkward behavior, all bets are off. Straight transactions even of the tax board variety, long as they're paid off during the grace period as transactors do, no problem.