Recently purchased a new refrigerator (our Avocado Green fridge was really beginning to show its age) and used a store credit card when offered an extra 15% discount to do so. Paid that card balance in full five days later (actually two, but it took three more for the payment to clear). However, the store card closed the day after the purchase (who knew? had not used it in years) and reported 100% utilization. Total utilization was still less than three percent, but that one card's being 100% resulted in a 32 point drop in FICO score. Will be watching next month to see if lowering that card's utilization to zero again will have any effect on the score.
Starting Score: 777
M/C $22,000/<$100; VISA $15,000/<$50; VISA $23,000/<$100; M/C $15,600/<$500; M/C $20,000/$0; Macy's $500/$0; Sears $2,000/$2,000. Plus mortgage $160,000/$90,000 and vehicle $24,000/$9,000. So, CL is $98,000 and usage is less than $2,700 or about 2.7%. The mortgage and vehicle loans are both one year old, so should not affect any single month's figures, except that they are declining at better than $3,000 per month. Nice to hear that FICO has no memory. Every card is zero as of today.
Yes, I meant all the cards have been paid down to zero as of today. I tried the other approach, leaving a small balance on several cards, and got dinged for having "too many accounts with balances." Nevertheless, I do have a couple of cards that I do not normally carry with me that are set up for automatic charges (my NetFlix bill, for instance) just before the closing date and automatic payments to cover them set for a few days after the closing date. For the other cards, I check the accounts a few times a week and pay any balances. With EFT, and especailly with a bank that requires multiple "bill payments" per month in order to avoid fees, I no longer pay bills just once a month. In fact, I just checked, and found I made 66 credit card payments during the first quarter. That sounds about right, since we have over a dozen accounts. It also guarantees that we will never have a carryover balance. The only negative is that we don't pay enough attention to closing dates, and every time we buy a big ticket item it almost invariably happens right before that card's closing date.