When is it best to pay your credit card balance? (Before,after, or doesn't matter?)

[pizzaman1]

so as soon as that statement is available PIF way before the due date?

[sarge12]

---

@pizzaman1 wrote:

so as soon as that statement is available PIF way before the due date?

---

That depends on wheather you wish to have a balance reporting on that card...to prevent reporting it must be paid before the statement cuts. If the statement shows a balance it must be paid in full before the due date to avoid interest. The day after the due date if there is a balance you will be charged interest  from the previous month based on the average daily balance and daily periodic rate. If the statement has a balance paying it in full any time prior to due date will result in 0 interest. The due date will be at least 25 days after statement cuts, and there is no advantage in paying it 2 days after statement cuts over paying it 20 days after statement cuts. This may not be true on some sub prime cards.

[Anonymous]

I just asked a similar question but for utlization reasons.


My balance is twice as much as I'd like it to report. I am wondering if it's even worth paying today since my statement cuts today.

[HeavenOhio]

---

@Anonymous wrote:

I just asked a similar question but for utlization reasons.


My balance is twice as much as I'd like it to report. I am wondering if it's even worth paying today since my statement cuts today.

---

I'd bet that it works as long as you get it in by the end of the business day. There's no better time than the present to find out.

[vanillabean]

---

@HeavenOhio wrote:

---

@Anonymous wrote:

My balance is twice as much as I'd like it to report. I am wondering if it's even worth paying today since my statement cuts today.

---

I'd bet that it works as long as you get it in by the end of the business day. There's no better time than the present to find out.

---

It worked for me yesterday. See also The time of day your credit card bill is due can vary.

[Anonymous]

I'm having the same issue and I want to make sure I have this right because I want to keep my utilization under 5% at all times.  So, if my statement opens on March 10th, closes on April 9th, and my bill is due on May 6th, when is the best time PIF so no balance (or a very, very, small one) reports?

[Anonymous]

@sarge12 wrote:

I want to expand on my previous answer, as many are confused about the 3 important dates.

1) Statement print date...is simply the day that a statement is generated and will include all charges that have posted up until that date. If there is any account balance on that date it will be reported to the CRA's as the statement balance and be included in utilization. To avoid a balance being reported, your current balance must be paid to 0 a few days before the statement cuts. If you can see a new statement online, or recieved one in the mail this date has passed. If the statement shows anything other than 0 balance, it is too late to prevent reported balance to CRA.

2) Due date as shown on the statement....This is the date by which the entire statement balance must be paid if you wish to not pay interest. This is also the date by which the minimum payment must be paid. If it is not, the issuer considers it late, and the issuer can and likely will charge you a late fee...usually about 35 dollars...and may even lead to adverse actions. It will not however result in being reported late on your credit report...that is where the third date comes in.

3) CRA late reporting date.....This is the date that will be reported as delinquent to the CRA's, and is 30 days past the due date. Delinquincies are reported as 30, 60, 90, 120 days late...so anything less than 30 days late will not report as late to the CRA, even though it will be considered late by the issuer even 1 day past the due date. If you have any reportable delinquincies, it will remain on the credit report for 7 years, unless you can somehow successfully have it removed.

So in summary to avoid any balance reporting...PIF before Statement print date. To avoid interest PIF entire statement balance before due date. To avoid penalty pay at least minimum before due date. If minimum is not paid before 30 days late it will cause major harm to your credit report.

---

THANKS!!!!!!!! You really cleared this up for me bigtime!!! 

[sarge12]

---

@Anonymous wrote:

I'm having the same issue and I want to make sure I have this right because I want to keep my utilization under 5% at all times.  So, if my statement opens on March 10th, closes on April 9th, and my bill is due on May 6th, when is the best time PIF so no balance (or a very, very, small one) reports?

---

Before April 9th closing date. On this date a new statement will cut and any unpaid balance will be on that statement, and this is what will be reported to the CRA's as balance and figured into the utilization.

[Anonymous]

Thank you VERY MUCH!!!

[Revelate]

---

@SouthJamaica wrote:

---

@Leaf wrote:

Say my cards payment due date is on Friday April 21st, does it matter if I pay off the current balance before my due date, or is it better to pay off the entire balance afterwards for that month, April 22nd onward without incurring the interest yet (ie they'll request a minimum payment of say $35 but I just pay it all off instead). 

Want to understand if doing one way is better for the other in terms of affecting credit. 
The main reason I ask is because, I've had a chase freedom credit card for 5 years now with no offer or auto credit limit increase, and am unsure how the actual system works for counting things like utilization. I've always paid off my current balance 1 or 2 days before the cut off /payment due date, so it would be $0 going into the next month's cycle. Would always making a payment prior to the due date make it look like I don't use my card much, therefore have no headroom for requesting a higher limit? 

---

1. You should never ever pay after the due date, but it wouldn't make a difference to the lender how close to the due date you paid.

2. It could make a difference to your FICO 8 score and to some of your other FICO scores. The optimal credit card utilization is all cards but one reporting a zero balance and one card reporting a sub 10% balance. So that would mean paying all but one of your cards that are in use before the statement cut.

---

Until those pesky lender algorithms take a look at your account

That said I don't worry about it, if I need to PIF beforehand I do, if not I usually just sloppily pay everything on the 1st of the month roughly.  Financially you just put it on autopay for statement balance and go on with life, keep the money in your pocket for as long as possible rather than giving the the lender the money early (where the get the interest/revenue rather than you) but hey.