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CC Balances

socalchef00
Contributor

CC Balances

So I am trying to figure out if I should be carrying a balance on all cards or just one card?

 

I've been reading around and I'm not sure what to do. I see some things say that you can carry a balance on one card and the rest report zero and it will show that you're still using your credit. Then I've seen that you should be carrying a balance over zero but less than 10% of your limit. 

Is this on ALL cards or just less than 10% of your overall CC limits?

 

I currently use a few different cards for their rewards but pay them off weekly and by statement date they are reporting a $0 balance 99% of the time. However 3 other cards do report a balance as I'm still paying them down.

 

Wha'ts the best way you all have seen to maximize the credit profile and payments towards the cards?

: $500, : $3,000, : $12,000, : $2,000, : $2,800, : $6,750, : $12,500, : $2,000,: $2,500, : $7,500, : $8,600, : $2,000, : $3,000, : $3,600, : $5,000, : $2,500,: $12,500, : $7,800, : $2,000, : $5,200
TransUnion FicoScore 8 : 815 | EquiFax FicoScore 9 : 794 | Experian FicoScore 8 : 792
Total Credit Limit Of : $103,750
Avg Cr Age : 6 Yrs., Oldest card : 17 years, Youngest card : 1 year
Message 1 of 10
9 REPLIES 9
Iusedtolurk
Established Contributor

Re: CC Balances


@socalchef00 wrote:

So I am trying to figure out if I should be carrying a balance on all cards or just one card?

 

I've been reading around and I'm not sure what to do. I see some things say that you can carry a balance on one card and the rest report zero and it will show that you're still using your credit. Then I've seen that you should be carrying a balance over zero but less than 10% of your limit. 

Is this on ALL cards or just less than 10% of your overall CC limits?

 

I currently use a few different cards for their rewards but pay them off weekly and by statement date they are reporting a $0 balance 99% of the time. However 3 other cards do report a balance as I'm still paying them down.

 

Wha'ts the best way you all have seen to maximize the credit profile and payments towards the cards?


@socalchef00  Really depends on your goals. Not carrying a balance on your cards except one with low utilization is generally used when you are getting ready to app for something and you want your credit to look the best. (AZEO all zero except one).

 

When I started rebuilding I carried balances on all my cards now I carry low balances on around three. (sometimes switching them up for the heck of it.

 

Your utilization has a bigger affect on Fico 8s and accounts with balances affect mortgage scores more.

 

For example I had 4 accounts with balances and my EX mortgage score was 745. I went down to 3 accounts with balances and my mortgage score was 750. Yesterday I had 2 accounts reporting with balances and my mortgage score went up 10 points to 760.

 

Fico 8 stayed the same at 745 even though my aggregate utization went from 4% to 2%.

 

It's always good to keep individual cards under 30% and aggregate the same. Time will increase your scores naturally as accounts age and inquiries fall off.

 

Credit issuers know internally you are using your cards.

Message 2 of 10
OmarGB9
Community Leader
Super Contributor

Re: CC Balances

I just want to point out that there's a difference between carrying a balance, and reporting a balance. Carrying means you rollover a balance from one month to the next, meaning you'll be paying interest and diluting rewards. You don't want to carry a balance. Reporting a balance is what you want to do. Reporting a balance means using your card as much as you want and whatever balance is posted by the cycle closing date is what is reported to the bureaus (with the exception of a few lenders, such as US Bank, who reports at the end of the month). Whatever balance is reported must be paid in full before the next cycle closes to avoid incurring interest. 

 

Now, to maximize scores, you want to implement AZEO, or All Zero Except One. This means using all your cards as much as you want, but making sure you pay them all down to zero balance BEFORE their respective due dates, EXCEPT for one bankcard (and by bankcard I mean from a major bank such as Wells Fargo, Citi, Capital One, Chase, etc.). On this one card you would leave a small $10-$20 balance before the cycle closes. Once the cycle closes and your new statement is generated, then you can simply pay off that small $10-$20 balance right away. Rinse and repeat. This way you are maximizing scores, rewards, and you are NOT paying interest. 


Last App: 12/27/2021
Penfed Power Cash Rewards Visa Signature

Currently rebuilding as of 04/11/2019.

Starting FICO 8 Scores:




Current FICO 8 scores:


Message 3 of 10
Brian_Earl_Spilner
Community Leader
Mega Contributor

Re: CC Balances


@OmarGB9 wrote:

I just want to point out that there's a difference between carrying a balance, and reporting a balance. Carrying means you rollover a balance from one month to the next, meaning you'll be paying interest and diluting rewards. You don't want to carry a balance. Reporting a balance is what you want to do. Reporting a balance means using your card as much as you want and whatever balance is posted by the cycle closing date is what is reported to the bureaus (with the exception of a few lenders, such as US Bank, who reports at the end of the month). Whatever balance is reported must be paid in full before the next cycle closes to avoid incurring interest. 

 

Now, to maximize scores, you want to implement AZEO, or All Zero Except One. This means using all your cards as much as you want, but making sure you pay them all down to zero balance BEFORE their respective due dates, EXCEPT for one bankcard (and by bankcard I mean from a major bank such as Wells Fargo, Citi, Capital One, Chase, etc.). On this one card you would leave a small $10-$20 balance before the cycle closes. Once the cycle closes and your new statement is generated, then you can simply pay off that small $10-$20 balance right away. Rinse and repeat. This way you are maximizing scores, rewards, and you are NOT paying interest. 


Chase shouldn't be used as the one. When the balance zeros they report it.

    
Message 4 of 10
OmarGB9
Community Leader
Super Contributor

Re: CC Balances


@Brian_Earl_Spilner wrote:

@OmarGB9 wrote:

I just want to point out that there's a difference between carrying a balance, and reporting a balance. Carrying means you rollover a balance from one month to the next, meaning you'll be paying interest and diluting rewards. You don't want to carry a balance. Reporting a balance is what you want to do. Reporting a balance means using your card as much as you want and whatever balance is posted by the cycle closing date is what is reported to the bureaus (with the exception of a few lenders, such as US Bank, who reports at the end of the month). Whatever balance is reported must be paid in full before the next cycle closes to avoid incurring interest. 

 

Now, to maximize scores, you want to implement AZEO, or All Zero Except One. This means using all your cards as much as you want, but making sure you pay them all down to zero balance BEFORE their respective due dates, EXCEPT for one bankcard (and by bankcard I mean from a major bank such as Wells Fargo, Citi, Capital One, Chase, etc.). On this one card you would leave a small $10-$20 balance before the cycle closes. Once the cycle closes and your new statement is generated, then you can simply pay off that small $10-$20 balance right away. Rinse and repeat. This way you are maximizing scores, rewards, and you are NOT paying interest. 


Chase shouldn't be used as the one. When the balance zeros they report it.


That's right. My bad. Scratch that.


Last App: 12/27/2021
Penfed Power Cash Rewards Visa Signature

Currently rebuilding as of 04/11/2019.

Starting FICO 8 Scores:




Current FICO 8 scores:


Message 5 of 10
socalchef00
Contributor

Re: CC Balances


@OmarGB9 wrote:

I just want to point out that there's a difference between carrying a balance, and reporting a balance. Carrying means you rollover a balance from one month to the next, meaning you'll be paying interest and diluting rewards. You don't want to carry a balance. Reporting a balance is what you want to do. Reporting a balance means using your card as much as you want and whatever balance is posted by the cycle closing date is what is reported to the bureaus (with the exception of a few lenders, such as US Bank, who reports at the end of the month). Whatever balance is reported must be paid in full before the next cycle closes to avoid incurring interest. 

 

Now, to maximize scores, you want to implement AZEO, or All Zero Except One. This means using all your cards as much as you want, but making sure you pay them all down to zero balance BEFORE their respective due dates, EXCEPT for one bankcard (and by bankcard I mean from a major bank such as Wells Fargo, Citi, Capital One, Chase, etc.). On this one card you would leave a small $10-$20 balance before the cycle closes. Once the cycle closes and your new statement is generated, then you can simply pay off that small $10-$20 balance right away. Rinse and repeat. This way you are maximizing scores, rewards, and you are NOT paying interest. 


Yes, that is what I meant. I do not want to pay interest. I just meant to have them reporting a balance prior to me paying it off

3 of my cards do have balances that will be reporting and unfortunately getting interest, but I am working on paying them down.

None of course are the big banks, so I assume I should run a $10 +/- balance on my Capital One card then pay it off ?

: $500, : $3,000, : $12,000, : $2,000, : $2,800, : $6,750, : $12,500, : $2,000,: $2,500, : $7,500, : $8,600, : $2,000, : $3,000, : $3,600, : $5,000, : $2,500,: $12,500, : $7,800, : $2,000, : $5,200
TransUnion FicoScore 8 : 815 | EquiFax FicoScore 9 : 794 | Experian FicoScore 8 : 792
Total Credit Limit Of : $103,750
Avg Cr Age : 6 Yrs., Oldest card : 17 years, Youngest card : 1 year
Message 6 of 10
805orbust
Established Contributor

Re: CC Balances

Yep, that'll do it. Although, like previously said, the AZEO thing is really only necessary when you've got a big app coming up (mortgage,  car, HELOC, etc) That thing is maddening to try and maintain month after month... but that's just me. There are some credit management sorcerers here 🤣


Message 7 of 10
OmarGB9
Community Leader
Super Contributor

Re: CC Balances


@socalchef00 wrote:

@OmarGB9 wrote:

I just want to point out that there's a difference between carrying a balance, and reporting a balance. Carrying means you rollover a balance from one month to the next, meaning you'll be paying interest and diluting rewards. You don't want to carry a balance. Reporting a balance is what you want to do. Reporting a balance means using your card as much as you want and whatever balance is posted by the cycle closing date is what is reported to the bureaus (with the exception of a few lenders, such as US Bank, who reports at the end of the month). Whatever balance is reported must be paid in full before the next cycle closes to avoid incurring interest. 

 

Now, to maximize scores, you want to implement AZEO, or All Zero Except One. This means using all your cards as much as you want, but making sure you pay them all down to zero balance BEFORE their respective due dates, EXCEPT for one bankcard (and by bankcard I mean from a major bank such as Wells Fargo, Citi, Capital One, Chase, etc.). On this one card you would leave a small $10-$20 balance before the cycle closes. Once the cycle closes and your new statement is generated, then you can simply pay off that small $10-$20 balance right away. Rinse and repeat. This way you are maximizing scores, rewards, and you are NOT paying interest. 


Yes, that is what I meant. I do not want to pay interest. I just meant to have them reporting a balance prior to me paying it off

3 of my cards do have balances that will be reporting and unfortunately getting interest, but I am working on paying them down.

None of course are the big banks, so I assume I should run a $10 +/- balance on my Capital One card then pay it off ?


Well you can run as much as you want through it, just be sure a few days before the cycle ends that it is paid down to +/- $10 and stop using it until the new statement is generated.


Last App: 12/27/2021
Penfed Power Cash Rewards Visa Signature

Currently rebuilding as of 04/11/2019.

Starting FICO 8 Scores:




Current FICO 8 scores:


Message 8 of 10
IntegerIntrovert
Regular Contributor

Re: CC Balances

Since AZEO is so much work, I've just been using my Apple Card to 0% finance whatever the latest phone or toy is.  Someone in the family always needs something.  That way the rest of my cards just get auto paid in full each month.



EQ - 768 / TU - 777 / EX - 772
Message 9 of 10
FireMedic1
Super Contributor

Re: CC Balances

Most of what you asked has been covered. If you dont want to pay interest. Then dont run balances unless you really need to. AZEO is so you dont get hit with the no cards reporting penalty. Charge things on all your cards. Just pay them all down before the statement cuts and leave one with $20. Then pay it after it posts. No interest. AZEO isn't hard. Been doing it since BK (6yrs) and I have not paid 1 cent in interest and have gained thousands in CB and rewards. I have desktop shorcuts on my screen to each creditor renamed to the statement date. Turn on the computer and there they sit. Ok Cap1 is getting ready to report. Pay it. Done. Why have a CB card and then pay interest? You just lost your profit to interest. Make sense?





Homeowner since Sept 2020. My posts are JMHO. My siggy is not to brag. Just sharing my experiences after BK from learning here from rebuild to recovery from the @ 540's.
Message 10 of 10
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