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Strategy for posting zero balance?

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Strategy for posting zero balance?

Hello,

 

For my daily driver card(s), there are pretty much always some lingering pending transactions that post the day my statement cuts and thus shows up as a balance before I have a chance to pay it. Other than obviously not using my cards the days leading up to statement cut, what do you guys do to avoid posting balances, or do you just let it happen?

 

Thanks.

Message 1 of 6
5 REPLIES 5
Valued Contributor

Re: Strategy for posting zero balance?

Posting balances is a good thing.

 

Posting huge balances... not so much but, the impact goes away once it's paid off and reported again at the lower amount.

 

I have 7-8 cards that report balances and scores over 800 but, those balances only account for ~1% of my combined limits... Individually they're somewhere between 7-12% depending on the card.  There's always a fluctuation in points from month to month or even week to week depending on which  mornitoring I'm looking at.

 

Showing use isn't a bad thing at all.  Some lenders will deny you an approval from lack of use usually noted as "sufficient credit available" and if you don't show some use reporting each month somewhere it makes it hard to get your limits higher as well.

 

The main concern for ultra low UTIL such as AZEO is more impactful when trying to gain an advantage when applying for a car/mortgage and being in the most ideal situation before they pull your reports for the best terms and lowest rates for a large purchase.

500K+ TCL / 800+ FCOs
Message 2 of 6
Community Leader
Senior Contributor

Re: Strategy for posting zero balance?

Keep in mind that "responsible usage" is defined as keeping balances under 28.9% of limits. And paying your statement balances in full by the due date will avoid any interest.

 

That said, AZEO (all zero except one) will optimize your scores. That's where you allow a tiny balance on one card to report with the rest of your cards reporting zero. You may wish to aim for this at times when you're applying for important credit, if you wish to use the numbers while testing your score, or if your score is on the low end.

 

I like using AZEO when I'm testing scoring behavior. I recently tested to see what happened when a single balance went from $6 (AZEO) to $896 to $1425. Keeping only the single balance kept other factors from muddying the results. Another test involved two very low balances compared to AZEO.

 

For the most part, I think that keeping all cards at 28.9% or below is sufficient. If you're applying for a mortgage, you should be prepared to do AZEO if it'll get you a better rate. I'd also suggest AZEO or something close to AZEO if your scores are such that you can bump yourself in a range that's desirable vs. undesirable, like bumping yourself over 680 or 700. And testing one's scores and becoming familiar with how they react to (reasonable) reporting behaviors is always cool.

 

The only way to control balances at reporting time is to curtail the use of that card. That usually means a couple of days where you stop charging entirely or keep your charges low enough to stay below your desired balance. The workaround would be to use a different card during those days.

 

As you get better at this, you'll be able to cut things pretty close. You want to your pending charges and your payment to clear by the day before the statement cut date. Check your statements for merchants you use routinely. If you see that they claim their charges quickly, you can charge almost up to the last minute. If you know a merchant tends to dawdle in claiming pending charges or you've never shopped with a merchant, allow more time for charges to clear.

 

You have extra leeway with Chase and Discover. In addition to reporting the statement balance, Chase reports zero whenever you pay to zero. And both cards will report your balance whenever you call and ask them to.

Message 3 of 6
Valued Contributor

Re: Strategy for posting zero balance?

Pushing payments from your online banking's bill pay will allow you to send $$ for charges that haven't posted yet.

 

 

Ch 7 Discharge May 2015
Discover/Target/NFCU CLOC/NFCU Cash Rewards/NFCU Platinum/PenFed Power Cash Rewards/PenFed Pathfinder AMEX/Citi Costco Visa - $96k total revolving
EQ/EX/TU: FICO 8's November 2019: 696/679/668, 14% utilization, AZE2 (w/ those 2 cards reporting 30% util), INQ's: 4/2/1
Message 4 of 6
Valued Contributor

Re: Strategy for posting zero balance?

What cards are your daily drivers? Chase will still report a zero balance to CRA, even if you PIF after the cut date. 

 

Since i don't practice AZEO until just prior to an app, I don't concern myself with too much micromanaging. What reports reports. 

Even if you want to play that game and PIF before the statement cut date, I don't see the harm in a few small balances reporting.

 

Gymnastics weren't meant to be performed in your mind over this type of stuff. lol






Message 5 of 6
Super Contributor

Re: Strategy for posting zero balance?


@russery wrote:

Hello,

 

For my daily driver card(s), there are pretty much always some lingering pending transactions that post the day my statement cuts and thus shows up as a balance before I have a chance to pay it. Other than obviously not using my cards the days leading up to statement cut, what do you guys do to avoid posting balances, or do you just let it happen?

 

Thanks.


If I want the account to report a zero statement balance, I would overpay. A credit balance reports as a zero balance.


Total revolving limits 730000 (603500 reporting) FICO 8 scores: EQ 722 TU 764 EX 734
Message 6 of 6
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