Maximizing credit card utilization to increase FICO...still unclear

[Anonymous]

My situation is like this.  I have 2 chase credit cards which I just finished paying and now both have a zero balance. 

Both have the same:

Payment due date = 18th of the month
Statement Closing date = 24th of the month (So from 25th (opening) to the 24th (close))

Chase 1 total credit line is $7000.
Chase 2 total credit line is $14,600

Moving forward if I want to increase my FICO (725), how many transactions should I have on each card each month, by what time during the month should I make the payment to each, and what percent of the transactions total usage should I pay monthly to each card (should I PIF both or leave $5, and at what time during the month should the payment be made)?

[SpecFile]

I'll keep it short and sweet.  To obtain the best scores with revolving credit keep your util at 1-9% of total CL.  Your two cards have a total CL of $21,600 so just keep your util reporting at 1-9%.

As far as when to pay and statement dates go, I will let someone else dig that deep.

Message Edited by SpecFile on 09-03-2007 11:48 AM

[Anonymous]

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SpecFile wrote:

I'll keep it short and sweet.  To obtain the best scores with revolving credit keep your util at 1-9% of total CL.  Your two cards have a total CL of $21,600 so just keep your util reporting at 1-9%.

As far as when to pay and statement dates go, I will let someone else dig that deep.

Message Edited by SpecFile on 09-03-2007 11:48 AM

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If you pay too soon, the creditor will not be able to report anything but a zero balance which will make it appear as though you are not utilizing the available credit. Wait until the statement is cut and allow them to report (usually within a few days) and then PIF. This way you will be showing responsible credit management. Just make sure you keep utils low, as SpecFile said.

[SpecFile]

When you say "cut the statement" does that mean when it arrives in the mail? 

Message Edited by SpecFile on 09-03-2007 01:23 PM

[Anonymous]

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SpecFile wrote:

When you say "cut the statement" does that mean when it arrives in the mail? 

Message Edited by SpecFile on 09-03-2007 01:23 PM

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Sorry, that is an accounting term that means when they create the statement. Most of my creditors have already reported before I get the statement in the mail. They seem to be on an automatic system so that when the statement is created, it reports automatically. At least that has been my experience. What I wish they would do is report my payment as fast as they report my charges. LOL

[SpecFile]

Ahhh,  so if they cut the statement with a balance of $100, then report the $100 balance a few days later, then I pay the statement balance to $0???   Why is this confusing me?

[Anonymous]

I understand the part of 1-9% utilization but I am still not sure when in my case I should make the payments.

[MidnightVoice]

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thomasil74 wrote:

I understand the part of 1-9% utilization but I am still not sure when in my case I should make the payments.

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What I do is monitor the cards on line, and I know the date the statement will be posted on line.  I pay (on line) most of the money I will owe so that it is recorded BEFORE the statement date.  That leaves a few bucks owing when the statement comes out, and this is reported to the CRA so it sees I used the card, and I pay that in full so there are no finance charges.

[Anonymous]

Your strategy makes sense.  My only question is when do you PIF to not be penalized with finance charges.

To maximize FICO score and pay the least amount of  fees.   If my statement comes out on the 24th of the month.  I want to know from when to when I should make transactions on the card.

When to pay most of the balance except $5.  When to pay it in full?

Message Edited by thomasil74 on 09-03-2007 03:10 PM

[Anonymous]

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MidnightVoice wrote:

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thomasil74 wrote:

I understand the part of 1-9% utilization but I am still not sure when in my case I should make the payments.

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What I do is monitor the cards on line, and I know the date the statement will be posted on line.  I pay (on line) most of the money I will owe so that it is recorded BEFORE the statement date.  That leaves a few bucks owing when the statement comes out, and this is reported to the CRA so it sees I used the card, and I pay that in full so there are no finance charges.

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I agree with Midnight that this is a good system. The only time this will not work is when you have a card like one of mine that has no grace period. In that case, it doesn't make any difference when you pay, you will still owe interest. Thankfully, I am now able to close that one out since I just got approved for a replacement card with double the CL.