Is it ever good to max out a card at least once?

[Anonymous]

I was wondering if it would be a good thing to let a 90% balance report? So hen the next statement cuts it actually shows that you can handle paying higher balances?


I just maxed out a card..mostly taking advantage of the rewards they are currently offering. I planned on paying in full the day all the charges post. It's a new cycle so I'm fine but it had me wondering if I should pay it or let it cut.

I guess the problem with this is it would bring my utilization up so high it'l hurt my score too much even if next month I keep it at 0?

[SouthJamaica]

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@Anonymous wrote:

I was wondering if it would be a good thing to let a 90% balance report? So hen the next statement cuts it actually shows that you can handle paying higher balances?


I just maxed out a card..mostly taking advantage of the rewards they are currently offering. I planned on paying in full the day all the charges post. It's a new cycle so I'm fine but it had me wondering if I should pay it or let it cut.

I guess the problem with this is it would bring my utilization up so high it'l hurt my score too much even if next month I keep it at 0?

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No. Never.

[Anonymous]

Charging up to your limit and paying in full right away accomplishes the same thing as maxing out your card and letting that balance report in terms of showing the creditor that you can pay off a high balance.  What matters are the dollars that you throw through a card in a cycle.  If you are flowing $5k through a $5k card, that's all that's considered even if you PIF and report $0. 

[Anonymous]

Nope

[jamesdwi]

Maxing out a sinanture card is fine, even a non-signature card,  but hell no don't let it report that way if you have a choice, Maxing out the card and paying it off before the statement reports is a way to tell the lender you might need a higher limit, no one else needs to know, But letting everyone know you maxed out a card probably isn't good. Way to panic your other lenders.   

I also recommedn you don't try that until you have made several payment cycles so the lender knows you pay your bill on time. So he doesn't freak out when a new card shows up maxed out for a week. 

[steel_string]

Different lenders have different rules for reporting highest balances. With some, you may be able to pay before statement cut and still report the new high balance. Others only report the highest statement balance as high balance. There's been speculation in the past about how lenders might use this data, but nobody knows for sure. Do while having large highest balances reported might help, I don't think I'd let a really high statement balance report just for that.

[Anonymous]

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@jamesdwi wrote:

Maxing out a sinanture card is fine, even a non-signature card,  but hell no don't let it report that way if you have a choice, Maxing out the card and paying it off before the statement reports is a way to tell the lender you might need a higher limit, no one else needs to know, But letting everyone know you maxed out a card probably isn't good. Way to panic your other lenders.   

I also recommedn you don't try that until you have made several payment cycles so the lender knows you pay your bill on time. So he doesn't freak out when a new card shows up maxed out for a week. 

It doesn't matter what kind of card it is, signature, non signature, Creditone, First Premier, or even First Bank of your choice! Don't MAX it and let it report..

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[Anonymous]

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.

[Anonymous]

Got it. I won't do it. Thanks. I'll either PIF or knock it down to 10% for utilization reasons.

[Anonymous]

Not 10% for utilization reasons.  Not 9% either.  BELOW 9%.

Also, there is ample evidence that Chase has given people CLIs who charged up their card to near 99% and let it report and then PIF'd after statement cut.  And since Chase will re-post a new report when you PIF a balance to $0, there's less risk of AA from other creditors.

Other lenders, not so much.