Should I max Amex High Balance to help my total credit limit?

[kromozome]

I'm new to Amex and I find it a much more useful card for my family in charging almost all our monthly expenses and purchases on the card. I had a much harder time keeping my credit utilization low with my Visa acountrs due to inconsistent balance reporting days and charges staying in pending status for days and days.

I see one of the bureaus (I Equifax) uses my highest statement balance and treats it as a credit limit so my total credit limit has now increased by this highest balance. I have been paying my Amex frequently until now because I didn't like seeing large balances. However, given this high balance is being used by one of the bureaus as a credit limit, is it adavantageous for me to let the balance get very high and wait to pay it off on the statement closing date? Or would that be a red flag that I charged 15-20k on my Amex in a month?

Any advice would be much appreciated? Thanks!

[SouthJamaica]

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@kromozome wrote:

I'm new to Amex and I find it a much more useful card for my family in charging almost all our monthly expenses and purchases on the card. I had a much harder time keeping my credit utilization low with my Visa acountrs due to inconsistent balance reporting days and charges staying in pending status for days and days.

I see one of the bureaus (I Equifax) uses my highest statement balance and treats it as a credit limit so my total credit limit has now increased by this highest balance. I have been paying my Amex frequently until now because I didn't like seeing large balances. However, given this high balance is being used by one of the bureaus as a credit limit, is it adavantageous for me to let the balance get very high and wait to pay it off on the statement closing date? Or would that be a red flag that I charged 15-20k on my Amex in a month?

Any advice would be much appreciated? Thanks!

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I assume you're talking about an Amex charge card.

The newer FICO algorithms simply disregard the card for utilization purposes.

A few of the older algorithms do include the card and treat the high credit as a credit limit.  So if you really are concerned about it you could let the whole thing report one month, and increase your "limit" that way. But bear in mind that for the month you let it all report, it will appear in those algorithms as a maxed out card.

[PackAttack07]

If you do plan on doing this, you need to be very very careful. Especially for a new or newish card. There is a type of fraud that banks are highly sensitive to call bust-out fraud which basically is when a customer accumulates multiple accounts with ever increasing limits and minimizes the use of them (to keep getting bigger limits), but then all of a sudden maxes out every dollar available to them at once and walks away with the money.

I agree that getting the max balance on the books is a good goal, but if you do this then you should do 3 things:

1. Max balance is generally the max balance at any single point (not sure if they include trailing interest or not since it isn't in your actual balance yet - I doubt it). Before you try this, use your limit to the max, then pay if (assuming that isn't too too difficult) before the statement cut date. I think you will find this achieves your goal without needing to have a current huge balance report

2. IF that doesn't work or you don't want to deal with managing that kind of spend potentially twice, make sure your other cards aren't reporting balances or minimum payments that are higher than they need to be (pay to $0 before statment end dates) to avoid triggering bust-out monitoring algorithms.

Do your plan to get to the limit on the charge card, then THE DAY AFTER your statement reports, pay the balance in full and do not use the card. Once your payment is applied and balance is $0 (may take a day or two but with me AMEX credits it immediately now), CALL AMEX's CREDIT REPORTING TEAM. Have them send a one-time update to the credit bureaus for your accounts.

Point 2 will allow you to get that Highest Balance logged, but it'll only appear to other creditors on your report for at most a few days. The fact that the $0 balance replaces the high balance should mean that any fraud triggers you trip (thus causing those creditors to watch your credit report like a hawk with SPs) will quickly see you paid the balance off to $0 already.