Question on CC utilization

[majesty]

Please forgive my ignorance but my question is if you max out (or close to it) a low limit card each month and always pay off the card in full at the beginning of the next month is this hurting my utilization?

[MidnightVoice]

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majesty wrote:

Please forgive my ignorance but my question is if you max out (or close to it) a low limit card each month and always pay off the card in full at the beginning of the next month is this hurting my utilization?

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Yes

[MidnightVoice]

And if you want a longer reply, I am sure someone will come along and direct you to Credit Scoring 101  

[majesty]

Thanks.... I have read that you should maintain a 1-9% utilization, but there was nothing about paying it off in full each month. Thought that by doing this I maintained a low utilization.... guess i was wrong again you guys are great.

[haulingthescoreup]

Another newbie here...after a weekend spent on the couch with laptop, cold medicine, and kleenexes, reading posts until I'm glassy-eyed, I now know enough to be dangerous. The credit reporting agencies only know the figure that your credit card companies report to them. If you're just about maxed out when they report, and then you pay them off after the data goes in, the CRA's don't know of your wonderfulness.

I called my CCC (the truly wonderful USAA, may they be forever blessed) and found the dates when they report to the CRA's. In both cases, it's the dates that the statements drop. So all I have to do is pay my cards down to the magic 1-9% about 5 days before they report, and the CRA's will be dutifully impressed. I hope.

You have to keep in mind the difference between what your CC's know about you (which would influence them in increasing your CL, for instance) and what the CRA's know about you (which influences them in setting your credit score.)

If I'm wrong, someone with experience please come rescue both of us!

[Anonymous]

You got it and will be hauling that score up in no time.  I actually pulled TC daily for a while to get an idea of the exact dates my cards posted and if they posted the statement amount of the amount at the time of posting.