Credit Score lowered eventhough I leave 1% CC balance-Confused

[frugal]

Experts, my EQ scored dropped by 3 points.  It might not sound a  lot but it has me puzzled and concern me.  I got an alert from MYfico on a CC that I've been paying and leaving 1% on every month.  The balance was $166 back in July 07,  now it reports on 8/10/07 that the balance is $58.00, which is incorrect because I don't carry that much of a balance on $300 credit limit.  

Does anyone know why this happen and how I can prevent it from happening again.  I thought this would have increased my score since I'm carrying a lower balance than previously.   I want to **bleep** it in the bud because 3 points here and there adds up especially if I'm doing something ignorant.

[Anonymous]

does this card report statement balance or report date balance?

Take HSBC that reports the balance on the last weekday of the month.

[frugal]

I appears that the card reports a statement balance.. it is a FirstPremierBank card.   Why woudl these two things matter...please educate me or anyone. Thanks

[Anonymous]

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@frugal wrote:

I appears that the card reports a statement balance.. it is a FirstPremierBank card. Why woudl these two things matter...please educate me or anyone. Thanks

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Ok let me give this a shot:

Let's say you have a 1000 CL - and you charge 200 on it.
and the statement comes out with a 200 balance- they report this amount even if you paid in full.

I have had make a second payment before the statement cust to get my UTL down.

Now with my household bank - the statement date is the 8th of the month but, they report my balance on the last weekday of the month.

So I have to make my payment a week before the due date so it reports a low balance.

[frugal]

I understand that scenario (thanks); however, my balance is still lower than the previously month.  I thought this in the right direction for my score to go up a couple of points, since technically Im not carrying a higher balance. and I'm paying it down to 1%. $166 and $54 balance is proof I've lowered the balance.  This shouldn't make my score go down.  I really appreciate that scenario, but I still would like to know why did it go down 3 points when I thought (from this forum and the experts) I was doing things correct.

[MidnightVoice]

Quite honestly, 3 points is not a major decrease.  I would not worry unless it really starts dropping.  Such small fluctuations happen all the time.  Something else might have changes.

[frugal]

Thanks MdnightVoice, but do you know why IT happened?  I'm just trying to understand so I can see what I can do to try to prevent it.  I use to ignore my Credit Score and I'm know since I've worked so hard to 3 points is a big deal.  Three points can put you at Good to Fair.  If someone could shed some light as to why it happened, it would so great.

[Anonymous]

By having any billed balance, you are using your credit on that card.  If you have 4 cards and 3 have balances when billed, that is using 75% of them, which counts against you on your score. It is to your benefit to have balances billed on fewer cards.  If you only have one card and it has a balance showing when billed (even if it is less than 1% of the CL), then your credit score is affected negatively because of your 100% usage.  However, you only need to charge something on the card every few months (every 6 months will work OK) to keep the card active as a good item that stays on your credit report.   You could let the CC show a billed balance once every few months. You will take a hit on your score that month but if you pay the CC in full the balance will be shown as 0 for the other months, which means your score will be higher for those months.     Since you are keeping the amount on the card low, you should be able to pay in full easily.  If you use the card frequently you could keep a record of your charges/credits and send in the payment in time so that when the card is billed the balance will show as zero every month.  A credit balance will still show as a  zero balance on your credit report.  By paying this way, you would also be avoiding some fc because if you leave a balance every month, they can still charge you the minimum fc.

[Anonymous]

I have 2 HSBC cards and True Credit show neither was updated on the last week day of the Month last month. July 25th and July 27th.

[Anonymous]

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@Anonymous wrote:

I have 2 HSBC cards and True Credit show neither was updated on the last week day of the Month last month. July 25th and July 27th.

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We are going to have bust out the "HSBC not updating" thread again.