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Will this effect my credit greatly?

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New Member

Will this effect my credit greatly?

Hi all!

 

I am new to this forum. It is always best to ask before I do something stupid. ^_^;;

I want to buy a road bicycle for $750 with my Amazon reward card which I have like $820 left.. My credit score is like 712 which is considered Fair..

My credit did went up from 680 to 712 because I applied for this card. How much would it drop if I do this move?

Message 1 of 14
13 REPLIES 13
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Moderator Emeritus

Re: Will this effect my credit greatly?

High utilization on a cc can cause significant FICO score drops.  It can also cause AA from your other creditors when they see high utilization on this card during a soft pull.

 

Many experts consider credit card debt as toxic debt.

Save your cash, and when you have enough to purchase the bike, put it on your card and PIF.

Don't look at your credit cards as available cash or as a way to get into debt.  They can, and will, eat you alive. 

 

For best FICO scores, keep all your accounts but one reporting a zero balance.  Let the one account report less than 9% balance.  You'll be FICO-happy.

 

Best wishes!

Just puttin' syrup on something, don't make it pancakes.
Message 2 of 14
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New Member

Re: Will this effect my credit greatly?

I have two accounts. I have sears and amazon.  You're saying to leave one of this at zero balance? Sorry, I really want to raise my score up. I want to have my credit score "good" or "very good" instead of "fair"

 

I don't know what you mean by zero balance. For instance, I have a sears card of 300 limit. You mean to pay it all gradually until it hits 300 and try not to spend below 290?

As of now, I have $30 on my sears account: $30 out of 300$.. and for amazon: 800 out of $1,000. If that's what you meant, you think I should do that for amazon? The problem is that I always order stuff from amazon. ^^

 

Also, I have two other debit card..but one of them charge me money when I check my balance in stores.. etc. Smiley Indifferent

Message 3 of 14
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Re: Will this effect my credit greatly?


@a00226270 wrote:

I have two accounts. I have sears and amazon.  You're saying to leave one of this at zero balance? Sorry, I really want to raise my score up. I want to have my credit score "good" or "very good" instead of "fair"

 

I don't know what you mean by zero balance. For instance, I have a sears card of 300 limit. You mean to pay it all gradually until it hits 300 and try not to spend below 290?

As of now, I have $30 on my sears account: $30 out of 300$.. and for amazon: 800 out of $1,000. If that's what you meant, you think I should do that for amazon? The problem is that I always order stuff from amazon. ^^

 

Also, I have two other debit card..but one of them charge me money when I check my balance in stores.. etc. Smiley Indifferent


Hello and welcome.

 

When we say zero balance we mean the balance that is reported on the account's monthly statement. Utilization calculation for most cards is calculated by this statement balance. You can use both cards as much as you want during the month but just make sure that one of them (your choice) is paid down to zero before it's statement posts. That is how you get that zero balance.

 

On your other card make sure it's statement balance is always less than 9% of it's credit limit. Again you can use it as much as you want but time your payments to achieve that desired utilization (<9%) several days before the statement posts. And then pay the balance before the due date to avoid finance charges.

 

 

 

From a BK years ago to:
EX - 9/09 pulled by lender 802, EQ - 2/11-816, TU - 2/11-782

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

Message 4 of 14
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New Member

Re: Will this effect my credit greatly?

 

 

Ha ha! I am sorry but I am a slow learner so I don't get it at all. I need some examples related to numbers. For instance,

 

Credit  limit  $300

Curent balance $261

Pending charge: 0

Available credit: $38

 

Cash limit $75

Cash available $38

 

That's for my sears card

 

 

And this is my amazon card:

 

 Outstanding Balance $201.28

Pending Charges $0.00

Total Credit Limit $1,000.00

Available Credit $798.00

Last Statement Date 02/24/2011

Next Closing Date 03/24/2011

Balance Last Statement  $154.20

 

 

 

 

 

 

Last Statement Date

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  
  
    
  
    
  
    
  
    
  
    
  
    
Message 5 of 14
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Moderator Emeritus

Re: Will this effect my credit greatly?


@a00226270 wrote:

 

Ha ha! I am sorry but I am a slow learner so I don't get it at all. I need some examples related to numbers. For instance,

 

Credit  limit  $300

Curent balance $261

Pending charge: 0

Available credit: $38

Cash limit $75

Cash available $38

 

That's for my sears card. You don't have the statement date for the Sears card (for instance the next statement date for the Amazon card is 03/24/2011) but once you know that date be sure and pay the entire balance to zero before then. Whatever amount is shown on your statement is what is used to calculate utilization for the month.

Utilization is figured by dividing the total balances by the total available credit. For the Sears card last month the utilization was 87% (261/300). That is very high and your score is hurting because of it.

You can use this card during the month but pay it down to zero before the next statement date.

 

 

And this is my amazon card:

 

Outstanding Balance $201.28

Pending Charges $0.00

Total Credit Limit $1,000.00

Available Credit $798.00

Last Statement Date 02/24/2011

Next Closing Date 03/24/2011

Balance Last Statement  $154.20 On this card right now your utilization is 20% (Total balance owed of $201.28 divided by total available credit of $1,000). Once again you can use this card during the month as much as you want but make sure that the balance that is shown on your next statement (That would be 03/24/2011) is less than 9% of your credit limit. In this case that amount would be no more than $90.

 

 

 

 

Message 6 of 14
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Re: Will this effect my credit greatly?

Oh! I think I got it. Thanks.

 

So I need to keep it nomore than $90 for Outstanding Balance?

And as for sears I need to pay it all? But I should wait for the next statement date?

 

Thanks a lot and I am sorry for this! I don't know anything about credit scores.

Message 7 of 14
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Moderator Emeritus

Re: Will this effect my credit greatly?


@a00226270 wrote:

Oh! I think I got it. Thanks.

 

So I need to keep it nomore than $90 for Outstanding Balance? That will keep your utilization right at 9%. Do this each and every month for the most impact to your score.

And as for sears I need to pay it all? But I should wait for the next statement date? Yes pay in full before each monthly statement date.

 

Thanks a lot and I am sorry for this! I don't know anything about credit scores. Don't apologize. No one has all the answers. Smiley Happy


 

Message 8 of 14
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Re: Will this effect my credit greatly?

Took me a while to figure it out. Thanks a lot!! I really want to raise my credits score signficantly. Sucks that I have to spend a lot on bills. But as long as I don't spend a lot , I will be fine. It is OK if I spend like $20-30 a month for sears and like $50-60 a month for amazon? I work at UPS so the pay suck... I want to try and spend at least $120-150 a month on this cards.

Message 9 of 14
Moderator Emeritus

Re: Will this effect my credit greatly?


@a00226270 wrote:

Took me a while to figure it out. Thanks a lot!! I really want to raise my credits score signficantly. Sucks that I have to spend a lot on bills. But as long as I don't spend a lot , I will be fine. It is OK if I spend like $20-30 a month for sears and like $50-60 a month for amazon? I work at UPS so the pay suck... I want to try and spend at least $120-150 a month on this cards.


You can spend as much as you want (without going over limit of course). Just make sure you know when your statements post each month so you can get those reported balances on each card where they need to be before the statements post.

 

 

 

From a BK years ago to:
EX - 9/09 pulled by lender 802, EQ - 2/11-816, TU - 2/11-782

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

Message 10 of 14
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