@Anonymous wrote:Signed up to ask all of you more credit educated people a question.
I have around 700 all the time, up or down 10 points. I charge maybe 5000 monhtly on various cards. I pay off every card every month and never carry a balance or pay interest.
The only debt I have is my house.
I have 0 missed payments.
Am I hurting my credit score by never carrying a balance over?
It just seems "to me" that always paying everything would be a good sign of credit worthiness, but maybe the fact no one is making money off of me hurts me?
Welcome to the forum @Anonymous
When you say you pay off every month and never carry a balance; are you meaning you pay your statement balance in full by the due date? Or are you paying the current balance to zero so no balance reports on your statements?
You do NOT need to carry a balance from month to month for best scores.
Best scores come from having 2 of 3 credit cards report a zero balance while the third reports a balance of less than 8.9% of that cards limit (known around here as AZEO - All Zero Except One). You'll also need an installment loan (auto loan, mortgage or student loan for example) to squeeze every point out.
My *guess* based on the information shared in your original post is your $5,000 a month in spending is reporting as over 28.9% individual utilization on one or more cards, causing your scores to remain suppressed even though you pay in full every month.
If my guess is correct, you can raise your scores by making a payment that brings the individual utilization under 28.9% (under 8.9% would be better) of the limit before your statement cuts.
There's a scoring penalty if you don't report a balance to the bureaus. Only needs to be $5-10 and pay it off.
I think your score should be at least 720, if you pay your cards on time, with a balance. The utilization rate thresholds, and not reporting a balance can affect your score. Also *guessing* you have no past charge offs or bankruptcy. As the others have said, we need a little more information.
@Anonymous wrote:Oh ok. I didn't even know Amex provided that. I guess my score is better than I thought. Amex says FICO is 762. That does sound better.
i never knew about the whole let one account show a balance thing. I'm definitely going to incorporate that in.
thank you guys
Just remember, showing a balance and carrying a balance are two different things. You don't have to pay interest for AZEO to work. A few days before your statement date pay down a large portion of your balance, and after the statement prints feel free to pay in full the remainder so you continue to get your grace period.