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Should I leave a balance?

Your FICO® Scores can impact your loan interest rates, terms, approvals and more.
Frequent Contributor

Re: Should I leave a balance?


@Girlzilla88 wrote:

I always use the heck out of my limit then pay it to 0 when payment due then have a TINY bit showing as long as all of your cards add up to the 8.9% then the AZEO method still applies for example I have one card at 5% one card at 2% and one at 1% and it works Smiley Very Happy    But I still use my limit and be sure to pay down to 0 when payment is due then get it up to the 1 or 2% etc when the statement hits Smiley Happy


Hmm...cool, thanks for sharing. So not QUITE AZEO, but more ALMOST zero across the board?



Current Scores Dec 2018 – FICO 8
Message 11 of 18
Frequent Contributor

Re: Should I leave a balance?

That is the way I do it some people do 0 but some cards frown and can penalize you for having 0 some will even forgive up to I think it's 4 dollars so I found that's my sweet spot for my cards but perhaps if someone has different cards the 0 would work better for them?    I'm just going by my big point jumps my score literally just jumped 60 points on my Experian from taking my higher CC back down to the 5% and still keeping tiny tiny balance on the other cards but over 5 bucks as long as the statement reflects no more than 8.9% together on mine I consistently see jumps Smiley Happy

Starting Score: 537
Current Score: 725
Goal Score: 775


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Message 12 of 18
Frequent Contributor

Re: Should I leave a balance?


@Girlzilla88 wrote:

That is the way I do it some people do 0 but some cards frown and can penalize you for having 0 some will even forgive up to I think it's 4 dollars so I found that's my sweet spot for my cards but perhaps if someone has different cards the 0 would work better for them?    I'm just going by my big point jumps my score literally just jumped 60 points on my Experian from taking my higher CC back down to the 5% and still keeping tiny tiny balance on the other cards but over 5 bucks as long as the statement reflects no more than 8.9% together on mine I consistently see jumps Smiley Happy


Wow, that's awesome - real time experience! First of all, congrats on the big jumps - I can see your progress in your profile. Second, thanks for sharing your actual results, pretty awesome stuff!



Current Scores Dec 2018 – FICO 8
Message 13 of 18
Highlighted
Frequent Contributor

Re: Should I leave a balance?

Yea np, I actually raised mine from lower 500's in Feb. 2018 to 755 December 2018, but I took advantage of it and refinanced my car and opened two unsecured cards, I was due for a CLI on my Amex today but found out they will be doing a HP so I decided to wait since I'm shooting for a Mortgage application literally tomorrow now that my scores reflect back over 700 Smiley Happy     I'll need to update my current scores tomorrow I didn't want to do the refresh until tomorrow right before I meet with the Mortgage person I work with haha.     But yes anytime I do it that way I see 20 point jumps, 40 point jumps and recently a 60 point jump so I know it works for me Smiley Very Happy    I hope it helps you too!

Starting Score: 537
Current Score: 725
Goal Score: 775


Take the myFICO Fitness Challenge








Message 14 of 18
Frequent Contributor

Re: Should I leave a balance?

VERY nice work, G-zilla - very happy for you! And no shame at all - you have to milk the score-thing for absolutely everything you can when it comes to nailing the mortgage! How are your mortgage scores - FICO 5/4/2?



Current Scores Dec 2018 – FICO 8
Message 15 of 18
Frequent Contributor

Re: Should I leave a balance?

I'm refreshing them tomorrow Smiley Very Happy     I don't want to shoot it to soon and it not reflect the most recent right before I go see him Smiley Very Happy    But my Experian updated itself today so I know my Experian Fico 8 is sitting at 705 right now 

Starting Score: 537
Current Score: 725
Goal Score: 775


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Message 16 of 18
Contributor

Re: Should I leave a balance?

@soupy5 wrote:

@BrutalBodyShots wrote:

@slowbut850sure wrote:

 

 

my TU on myFICO even said that not using my revolving credit hurt my score.  


That's of course not using your credit in the eyes of FICO, as many people can and do use their cards all the time, yet PIF their current balance to $0 and that $0 balance reports.  It's important to make this distinction when it comes to scoring, because as you saw you can use your credit cards regularly and still experience a scoring penalty for "no revolving credit use" because the algorithm cannot tell you're using it when only $0 balances are reported.


BBS,

 

Your advice is always on point and helpful. So, I think you just clarified a long-standing question I've had on AZEO. The concept I understand generally - all revolving accounts report $0 balance except one - pretty straightforward. 

 

However, my question always was:

 

1) For the accounts that report $0 - does that mean you can't charge on them at all once they get to $0? or....

2) For the accounts that report $0 - does that mean you CAN charge the heck out of them during the month, as long as you have them paid down to $0 by the closing date?

 

I think according to your last post, it's the latter that applies? Or, I guess either can apply, but I suppose you aren't getting "credit" for making use of the card in the eyes of the creditor if you simply never use the $0 balance cards?

 

Also, is there any upside to PIF before the due date, as opposed to PIF before the closing date?

Yes, you want to PIF on or before the due date.  The only time this does not matter is when you have a 0% APR period.  If you do not pay the entire balance by due date then you will be charged interest up until the day you pay off the entire balance.  You probably already know this, but I was not sure if you were asking about PIF/due dates in general or in relation to credit reporting.  I believe a CSR would refer to this as residual interest and I've seen a handful of negative reviews given to cards due to a cardholder's inability to grasp this concept, as if it were a specific tactic of a bank to charge more fees/interest.  However it is typically spelled out in the cardholder terms under 'grace period'...again, you probably already know this, but just throwing out info on topic.....

 

due date/closing date/reporting date are all technically different dates.  AZEO really only relates to reporting dates.  Apparently there are banks out there that report to CRAs mid-cycle.  I personally have not experienced this.  

my experience is:

-all the credit card issuers report shortly after the cycle ends.  I use AMEX, BoA, Chase, Cap1, Discover

-my student loan with FedLoan reports once a quarter it seems, haven't paid that much attention, but I think that is the frequency

-I noticed once in the past few months that Chase reported my balance on a Freedom Unlimited card prior to the cycle ending.  They reported the day after my due date if I remember correctly.  To my recollection that have not done that before, or maybe I have not noticed.  But it stuck out at me since both the FU and the Sapphire Preferred cards are due 26th and end 1st of each month.  They are typically reported between 2-5th.  During the odd reporting cycle described I paid my balance in full and then my $0 balance reported earlier than the cycle ended.  

Thanks!!


@soupy5

 

started tracking Experian - Starting Score:523 | Current Score:672 | Goal Score:740
now tracking all 3

2/20/19
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Message 17 of 18
Frequent Contributor

Re: Should I leave a balance?


@slowbut850sure wrote:
@soupy5 wrote:

@BrutalBodyShots wrote:

@slowbut850sure wrote:

 

 

my TU on myFICO even said that not using my revolving credit hurt my score.  


That's of course not using your credit in the eyes of FICO, as many people can and do use their cards all the time, yet PIF their current balance to $0 and that $0 balance reports.  It's important to make this distinction when it comes to scoring, because as you saw you can use your credit cards regularly and still experience a scoring penalty for "no revolving credit use" because the algorithm cannot tell you're using it when only $0 balances are reported.


BBS,

 

Your advice is always on point and helpful. So, I think you just clarified a long-standing question I've had on AZEO. The concept I understand generally - all revolving accounts report $0 balance except one - pretty straightforward. 

 

However, my question always was:

 

1) For the accounts that report $0 - does that mean you can't charge on them at all once they get to $0? or....

2) For the accounts that report $0 - does that mean you CAN charge the heck out of them during the month, as long as you have them paid down to $0 by the closing date?

 

I think according to your last post, it's the latter that applies? Or, I guess either can apply, but I suppose you aren't getting "credit" for making use of the card in the eyes of the creditor if you simply never use the $0 balance cards?

 

Also, is there any upside to PIF before the due date, as opposed to PIF before the closing date?

Yes, you want to PIF on or before the due date.  The only time this does not matter is when you have a 0% APR period.  If you do not pay the entire balance by due date then you will be charged interest up until the day you pay off the entire balance.  You probably already know this, but I was not sure if you were asking about PIF/due dates in general or in relation to credit reporting.  I believe a CSR would refer to this as residual interest and I've seen a handful of negative reviews given to cards due to a cardholder's inability to grasp this concept, as if it were a specific tactic of a bank to charge more fees/interest.  However it is typically spelled out in the cardholder terms under 'grace period'...again, you probably already know this, but just throwing out info on topic.....

 

due date/closing date/reporting date are all technically different dates.  AZEO really only relates to reporting dates.  Apparently there are banks out there that report to CRAs mid-cycle.  I personally have not experienced this.  

my experience is:

-all the credit card issuers report shortly after the cycle ends.  I use AMEX, BoA, Chase, Cap1, Discover

-my student loan with FedLoan reports once a quarter it seems, haven't paid that much attention, but I think that is the frequency

-I noticed once in the past few months that Chase reported my balance on a Freedom Unlimited card prior to the cycle ending.  They reported the day after my due date if I remember correctly.  To my recollection that have not done that before, or maybe I have not noticed.  But it stuck out at me since both the FU and the Sapphire Preferred cards are due 26th and end 1st of each month.  They are typically reported between 2-5th.  During the odd reporting cycle described I paid my balance in full and then my $0 balance reported earlier than the cycle ended.  

Thanks!!


@soupy5

 


Great feedback, slowbut850sure - I will take note.



Current Scores Dec 2018 – FICO 8
Message 18 of 18