Increasing credit score with two credit cards

[Tylerray0722]

Hello everyone,

I have two Capital One credit cards (Platinum Secured Card, Quicksilver) I use every month and pay down to 0. My credit score dropped a few points when my combined balance was 0 for both cards. I see articles online saying it's good to keep your combined balance lower than 10% but never 0. Let's say I paid my balance down to 6% every month, but it increased to 8% or decreased to 6% next month. Would that affect my score negatively or positively as long as I keep it under 10% but never 0?

[Brian_Earl_Spilner]

It could be 1% if you want. You simply have to let something report before paying it off.

[Tylerray0722]

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@Brian_Earl_Spilner wrote:

It could be 1% if you want. You simply have to let something report before paying it off.

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So it's not going to affect my credit score negatively if that 1% becomes 3% next month since the balance increased?

[Brian_Earl_Spilner]

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@Tylerray0722 wrote:

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@Brian_Earl_Spilner wrote:

It could be 1% if you want. You simply have to let something report before paying it off.

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So it's not going to affect my credit score negatively if that 1% becomes 3% next month since the balance increased?

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No, the known scoring threshold is 8.9%. there's talk of a 5% one, but I believe it only applies to certain scorecards.

[SouthJamaica]

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@Tylerray0722 wrote:

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@Brian_Earl_Spilner wrote:

It could be 1% if you want. You simply have to let something report before paying it off.

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So it's not going to affect my credit score negatively if that 1% becomes 3% next month since the balance increased?

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No it won't. It's unclear how high to go before you lose a point or two, but generally individual card utilzation of 28% or less won't really hurt you, and aggregate utilization of 6% or less won't really hurt you either.

But in your case, to maximize your score, you should let one card report a zero balance when the statement cuts.

[Anonymous]

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@Tylerray0722 wrote:

Hello everyone,

I have two Capital One credit cards (Platinum Secured Card, Quicksilver) I use every month and pay down to 0. My credit score dropped a few points when my combined balance was 0 for both cards. I see articles online saying it's good to keep your combined balance lower than 10% but never 0. Let's say I paid my balance down to 6% every month, but it increased to 8% or decreased to 6% next month. Would that affect my score negatively or positively as long as I keep it under 10% but never 0?

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If you are relatively new to credit (as I am, under 3yrs) you can pick up +3pts on EQ8 and +1pt on TU8 with aggregate utilization reporting below 5% after rounding. (See this chart for how to calculate it. Just scroll down a little, under utilization. )

For EX8, all cards need to be less than 5% individual utilization for a +3pt gain. That's after rounding, which means anything less than .045 x Card Limit. (e.g., .045 * $1000 = $45, anything less than $45 will work, $45 exactly is 4.5% which will round up to 5%)

100% of cards reporting a balance will cause a score drop on EQ/TU 8, but not EX 8. It's a significant drop at EQ/TU, but you can avoid it with only 1 card reporting a balance. (I routinely saw -19/-14 on EQ/TU 8 when 2 of 2 reported a balance. EX 8 doesn't care.)

Your score is based solely on profile data at the time you request it. The calculation doesn't depend on any prior data. I haven't seen any change in score from 5% to 9% aggregate utilization, with total balances below $2000. (Some do see changes, but with much higher balances.) It's only a minor change as described above when going below 5% - on my young credit profile.

There can be several days between the time you receive a new monthly statement notification and when a particular bureau has the updated data. Experian usually has it the next day (after 3AM Eastern Time).