Utilization/balance reporting

[Anonymous]

What is the best strategy for boosting credit score when it comes utilization reporting??? Should all cards be paid down to 0? Should all cards carry a small balance? Any tips would be much appreciated!

[Anonymous]

For best scoring, all cards should be at 0% except for one, and that one should report under 9%. But that's just for best scoring. For best SLs when you're apping for new cards, it's better to have a balance under 30% on at least 2 cards.

[Anonymous]

How do I go about having a card report at 0 or 1%. Meaning like if my due date is the 16th each month, clearly I understand that I need to pay in full for a $0 balance, but when does that balance report?? On the due date??? How soon can I make purchases after the due date, in order for the balance to report at 0.

Same question for the 1%. Do I pay the balance except for a small amount? Or do I pay the balance, and recharge a small amount? And how can I find out what day it reports?

[Anonymous]

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@Anonymous wrote:

How do I go about having a card report at 0 or 1%. Meaning like if my due date is the 16th each month, clearly I understand that I need to pay in full for a $0 balance, but when does that balance report?? On the due date??? How soon can I make purchases after the due date, in order for the balance to report at 0.

Same question for the 1%. Do I pay the balance except for a small amount? Or do I pay the balance, and recharge a small amount? And how can I find out what day it reports?

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The balance will report after your statement cuts, not on the due date. Each lender is different, so you'll have to look at your statements to see what the closing date is for each of your cards. For example, Capital One cuts my statement 3 days after the due date, but Amex cuts my statement 5 days after the due date. So once you figure out when your statement cuts, then you can spend again after that date. And in order to have say 5% util report, you just leave a small balance on your card until after the due date (still pay your minimum payment though) and after the statement cuts. Example; say you have a $1000 limit and you charge $100 that month. When your due date comes you can pay $50 and leave the remaining $50 until after your statement cuts. This will have 5% utilization report to the credit bureaus. After statement cuts pay off the remaining $50. Rinse and repeat.

[Anonymous]

So I think im starting to be confused, let me see if I got this...............

I'll use one of my cards as an example

Capital one with $750 limit.

Due Date is the 20th of each month

Statement generates on the 23rd of each month

So say my current balance is $0.

I charge $150 on the card.............

That's where i become confused.

I need to pay all but $37.50 of that by the due date of the 16th, even though a statement hasn't generated?

Or do I let the statement generate, pay all except 5%, and then pay the rest after the next statement generates?

[Anonymous]

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@Anonymous wrote:

So I think im starting to be confused, let me see if I got this...............

I'll use one of my cards as an example

Capital one with $750 limit.

Due Date is the 20th of each month

Statement generates on the 23rd of each month

So say my current balance is $0.

I charge $150 on the card.............

That's where i become confused.

I need to pay all but $37.50 of that by the due date of the 16th, even though a statement hasn't generated?

Or do I let the statement generate, pay all except 5%, and then pay the rest after the next statement generates?

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You got it. But in the example you provided, if you charged $150, you can pay $140 by (or preferably before) your due date on the 20th. That will leave you with a $10 balance. Leave that $10 on there until after the statement cuts on the 23rd.

Make it as simple as you can. You can even leave a $5 balance. Just whatever you do make sure you pay the majority of it by (or before) your due date.

And really, with this whole utilization thing, sure it will help your scores, but I think it's over rated. The most important thing to remember is always pay by your due date, try to pay more than the minimum due, and try not to let a balance greater than 30% report - cause that will hurt your score.

[Anonymous]

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@Anonymous wrote:

So I think im starting to be confused, let me see if I got this...............

I'll use one of my cards as an example

Capital one with $750 limit.

Due Date is the 20th of each month

Statement generates on the 23rd of each month

So say my current balance is $0.

I charge $150 on the card.............

That's where i become confused.

I need to pay all but $37.50 of that by the due date of the 16th, even though a statement hasn't generated?

Or do I let the statement generate, pay all except 5%, and then pay the rest after the next statement generates?

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Pay that by the 20th down to 37.50 or even 8.00 and let it report.  Once the statement cuts (generates) then it will show your new balance.  Most people get confused with this method.  They will pay by the due date and charge again right after which will make the statement cut with the new charges instead of your old balance.  Once you see your new low balance, you can charge again and repeat if you want. 

[Anonymous]

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@Anonymous wrote:

Pay that by the 20th down to 37.50 or even 8.00 and let it report.  Once the statement cuts (generates) then it will show your new balance.  Most people get confused with this method.  They will pay by the due date and charge again right after which will make the statement cut with the new charges instead of your old balance.  Once you see your new low balance, you can charge again and repeat if you want. 

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Thanks Sandi, I always have a tough time explaining it, and I think I end up confusing people more 

OP, just make sure you pay the majority of what you charged for the month by your DUE DATE (leaving a small balance, like a $5). Then don't charge anything on the card again until AFTER your statement generates. 

[Anonymous]

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@Anonymous wrote:

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@Anonymous wrote:

Pay that by the 20th down to 37.50 or even 8.00 and let it report.  Once the statement cuts (generates) then it will show your new balance.  Most people get confused with this method.  They will pay by the due date and charge again right after which will make the statement cut with the new charges instead of your old balance.  Once you see your new low balance, you can charge again and repeat if you want. 

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Thanks Sandi, I always have a tough time explaining it, and I think I end up confusing people more 

OP, just make sure you pay the majority of what you charged for the month by your DUE DATE (leaving a small balance, like a $5). Then don't charge anything on the card again until AFTER your statement generates. 

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So is it bad to pay a statement in full? I'm not quite understanding by leaving $5 in the balance. Wouldn't credit bureaus like to see everything be paid off? 

I would rather pay my statement in full so I get a sense of completion...

[Anonymous]

From what I think I'm understanding, it is so you have a card reporting, with a utilization between 1-9%. That's another part that I think im still confused on though. If I carry any balance, doesn't that cause me to be charged interest? Like currently have a zero balance and no payment due. So if I would make a charge today for $100, I think they are saying I should pay down to $5 or $10, and only let the small amount repor, when my statement generates on the 23rd. If I were to wait to pay anything at all until after the statement generates, a higher utilization would report, and then I'd have to pay the full amount before the due date, to avoid interest. I think.