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flojo's post: High Reported Utilization, But We PIF

flojo
New Member

flojo's post: High Reported Utilization, But We PIF

Hi,

 

I am in my early 40s. Reasonably high income household with excellent and long credit history. I have a 1.1M mortgage that is 6 years old and 3-4 revolving CC with 0 balance month to month. No car loan. no HELOC.  My score has been in the 750-795 range for the past 3 years. Never above 800. Now when I look at my credit report I see that my high CC balance are hurting my overall score and are probably the reason I have not joined the 800 club yet. However, seems FICO failed to recognize that 90% of my CC use is done through one Amex and one Visa card and although we have about $10k in charge monthly between these 2 accounts, we faithfully pay the balance every month and so really carry a 0 balance on these accounts!! . But FICO states I have $12k in revolving credit on my last statement which is not true !! I can't just start to move my life to a cash base just because of the FICO score  limitations. First that would mean giving up on hundred of thousands of Amex points, second it is dangerous for your health to carry to much cash around (and third my wife would never gave up  her platinum amex, lol). Seriously, we have enough assets we could get rid of all the credit we have but we would still be using our CC fairly heavily because we live in a high-cost environment (NYC) and we are a family with young kids with plenty of needs. Seems to me our FICO score really misses the mark. Any suggestion on how to raise my score are welcome.

 

 

edit: Hi, flojo, I split your post off from the original thread because it brings up a very valid point about FICO scoring that is surprising to those who are just learning about FICO scoring. Welcome to the forums!

Message 1 of 26
25 REPLIES 25
69Shack69
Member

Re: High Reported Utilization, But We PIF

Hi Flojo ~ I have almost the identical situation.  What I discovered is that immediately after an Amex statement comes out, that is when they report to the credit bureaus.  Since the date of the statement if fairly predictable, I simply go online a few days before the statement date and pay off the balance.  Thus, when the statement comes out, my balance is zero or very low if a charge or two comes through in the interim, but that will have little or no effect on your score. In essence, you are simply making your payment a few days early - no big deal.  I put an automatic reminder on my calendar to be sure I don't miss.  Hope that helps.


Starting Score: TU: 821/EQ: 800
Current Score: TU: 800/EQ: 796
Goal Score: Maintain 800s


Take the FICO Fitness Challenge
Message 2 of 26
flojo
New Member

Re: High Reported Utilization, But We PIF

An interesting solution I had not considered!! Thanks very much for sharing that thought.

Message 3 of 26
LilyBee
Regular Contributor

Re: High Reported Utilization, But We PIF

Flojo:

 

Don't forget the catch-22.  If you don't carry a balance in any of your credit cards, your score will be downgraded for not using credit that is available.  I too pay mine off if a bill comes in and thought with that practice my score would go up.  Then it was downgraded for not evidencing credit worthiness, or some crap like that.  So I use my debit card (credit union, no fees) and charge my AX when I purchase a book or dvd.

 

I haven't checked my scores lately, but will do so tomorrow.  Hang in there; you'll learn the game.

--------------------------------------------------------------------------------
Starting scores:2007 - TU-850; EX-850; EQ-850. JUNE 11, 2015 - TU-850; EX-850, EQ-850 - Also FICO 8.
LATEST SCORES: EQ: 850; TU: 850; EX: 850; FICO 9 - AS OF MARCH 7, 2016

LATEST SCORES AS OF Nov. 24, /2016 - TU- 850; EQ - 846; EX - 836.- Smiley Sad
Scores as of June 1, 2017: EQ - 842; TU 841; EX - 842;
SCORES as of April 19, 2018: EQ - 834; TU - 841; EX - 832.
New numbers will be posted in 2021
Message 4 of 26
haulingthescoreup
Moderator Emerita

Re: High Reported Utilization, But We PIF


@LilyBee wrote:

Flojo:

 

Don't forget the catch-22.  If you don't carry a balance in any of your credit cards, your score will be downgraded for not using credit that is available.  I too pay mine off if a bill comes in and thought with that practice my score would go up.  Then it was downgraded for not evidencing credit worthiness, or some crap like that.  So I use my debit card (credit union, no fees) and charge my AX when I purchase a book or dvd.

 

I haven't checked my scores lately, but will do so tomorrow.  Hang in there; you'll learn the game.


Surprising. I get an alert when I use my CC for the first time in a while, but it doesn't affect my scores.

 

I run everything (quite literally everything except my weekly offering at church, which is by check, and the occasional purchase of Girl Scout cookies) through credit cards, and I nearly always have all but one of them reporting $0. Whenever I let more balances report, my scores plummet. It's true that if they all report $0, my score drops a bit, so I just let one report a balance. Since I currently have a 0% BT on a Navy FCU card, that one does the job of reporting a balance.

* Credit is a wonderful servant, but a terrible master. * Who's the boss --you or your credit?
FICO's: EQ 781 - TU 793 - EX 779 (from PSECU) - Done credit hunting; having fun with credit gardening. - EQ 590 on 5/14/2007
Message 5 of 26
haulingthescoreup
Moderator Emerita

Re: High Reported Utilization, But We PIF


@flojo wrote:

Hi,

 

I am in my early 40s. Reasonably high income household with excellent and long credit history. I have a 1.1M mortgage that is 6 years old and 3-4 revolving CC with 0 balance month to month. No car loan. no HELOC.  My score has been in the 750-795 range for the past 3 years. Never above 800. Now when I look at my credit report I see that my high CC balance are hurting my overall score and are probably the reason I have not joined the 800 club yet. However, seems FICO failed to recognize that 90% of my CC use is done through one Amex and one Visa card and although we have about $10k in charge monthly between these 2 accounts, we faithfully pay the balance every month and so really carry a 0 balance on these accounts!! . But FICO states I have $12k in revolving credit on my last statement which is not true !! I can't just start to move my life to a cash base just because of the FICO score  limitations. First that would mean giving up on hundred of thousands of Amex points, second it is dangerous for your health to carry to much cash around (and third my wife would never gave up  her platinum amex, lol). Seriously, we have enough assets we could get rid of all the credit we have but we would still be using our CC fairly heavily because we live in a high-cost environment (NYC) and we are a family with young kids with plenty of needs. Seems to me our FICO score really misses the mark. Any suggestion on how to raise my score are welcome.

 

 

edit: Hi, flojo, I split your post off from the original thread because it brings up a very valid point about FICO scoring that is surprising to those who are just learning about FICO scoring. Welcome to the forums!


This is an exasperating result of lenders' decision to use the balance as of the statement for reporting purposes. IMO, it would have made a lot more sense to use the balance showing as of the due date, but then no one asked me.

 

As posted, the trick is to PIF (pay in full) your balances right before the statement dates, so that the statements don't show the full balance. Oddly, most people do better to have just one card reporting a token balance than to have all reporting $0. However, I suspect that with low reported util, this might not really be a factor for you, and you can get away with all (or both) reporting $0 if you want.

 

You actually don't have to do this all the time, although it does get addictive to see the much higher scores. You can do this 4-6 weeks before you anticipate apping for new credit if you like. I generally do this on the regular basis though, because sometimes I get an interesting opportunity for a good deal, and I hate to wait for a full month of billing cycles for lower balances to report.

 

Anyway, this is often called "playing the util game." It's sort of annoying, I guess, but it's a pretty harmless entertainment.

* Credit is a wonderful servant, but a terrible master. * Who's the boss --you or your credit?
FICO's: EQ 781 - TU 793 - EX 779 (from PSECU) - Done credit hunting; having fun with credit gardening. - EQ 590 on 5/14/2007
Message 6 of 26
GregB
Valued Contributor

Re: High Reported Utilization, But We PIF

I just don't see any problem here. A FICO of 800 is functionally the same as 760.

 

If you are showing $12K in Revolving Debt and have a FICO above 760, then there is really no advantage to doing anything to raise your score. That score gets you whatever credit you wish and if you do need a higher score you just pay a CC before statement date for that month. If you are PIFing anyway, you just pay one sooner.

 

Because of business CC showing on my personal reports my normal Revolving Balance that would report if I PIFed all CC would be about $40-45K. That is about four times more than yours.  That gets me FICO around 740 or so. If I needed a higher FICO for something I would just get my balance lower temporarily. I can only remember one time that a 740 wouldn't get me the very best terms. Schwab told me on one item that they really wanted to see "close to 800s".

 

My current Revolving is $96K, down from a peak of $147K thanks to finishing off a divorce two years ago. $147K gave me a 696 EQ FICO, it went to 701 pretty quickly as my balance went down and I am still at 701 with $96K.

 

Haulings idea of reporting "at the due date" might make sense if they report AFTER the payment on the due date. Before the payment would mean that when I finally get to the point of PIFing all accounts my reported amounts would almost double.

Message 7 of 26
LilyBee
Regular Contributor

Re: High Reported Utilization, But We PIF

Hauling said: 

 

1.  "Surprising. I get an alert when I use my CC for the first time in a while, but it doesn't affect my scores."

  

2. "I run everything (quite literally everything except my weekly offering at church, which is by check, and the occasional purchase of Girl Scout cookies) through credit cards, and I nearly always have all but one of them reporting $0.

 

 It's true that if they all report $0, my score drops a bit, 

3.  so I just let one report a balance."

 

1a. What kind of alert?

 

2a.  That doesn't make sense.  How can you run 'everything' through credit cards and have nearly all but one of them report $0?

 

3a.  That's why I said that I only charge a book or dvd to one token credit card, because I violently object if my scores are lowered without a valid reason.

 

 

 

--------------------------------------------------------------------------------
Starting scores:2007 - TU-850; EX-850; EQ-850. JUNE 11, 2015 - TU-850; EX-850, EQ-850 - Also FICO 8.
LATEST SCORES: EQ: 850; TU: 850; EX: 850; FICO 9 - AS OF MARCH 7, 2016

LATEST SCORES AS OF Nov. 24, /2016 - TU- 850; EQ - 846; EX - 836.- Smiley Sad
Scores as of June 1, 2017: EQ - 842; TU 841; EX - 842;
SCORES as of April 19, 2018: EQ - 834; TU - 841; EX - 832.
New numbers will be posted in 2021
Message 8 of 26
MarineVietVet
Moderator Emeritus

Re: High Reported Utilization, But We PIF


@LilyBee wrote:

Hauling said: 

 

1.  "Surprising. I get an alert when I use my CC for the first time in a while, but it doesn't affect my scores."

  

2. "I run everything (quite literally everything except my weekly offering at church, which is by check, and the occasional purchase of Girl Scout cookies) through credit cards, and I nearly always have all but one of them reporting $0.

 

 It's true that if they all report $0, my score drops a bit, 

3.  so I just let one report a balance."

 

1a. What kind of alert?

 

2a.  That doesn't make sense.  How can you run 'everything' through credit cards and have nearly all but one of them report $0?

 

3a.  That's why I said that I only charge a book or dvd to one token credit card, because I violently object if my scores are lowered without a valid reason.

 

 

 


I'll answer 2a. You pay the balance on all but one card before the statements post so that a zero balance is what is reported.

 

 

 

From a BK years ago to:
EX - 3/11 pulled by lender- 835, 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 9 of 26
haulingthescoreup
Moderator Emerita

Re: High Reported Utilization, But We PIF


@MarineVietVet wrote:

@LilyBee wrote:

Hauling said: 

 

1.  "Surprising. I get an alert when I use my CC for the first time in a while, but it doesn't affect my scores."

  

2. "I run everything (quite literally everything except my weekly offering at church, which is by check, and the occasional purchase of Girl Scout cookies) through credit cards, and I nearly always have all but one of them reporting $0.

 

 It's true that if they all report $0, my score drops a bit, 

3.  so I just let one report a balance."

 

1a. What kind of alert?

 

2a.  That doesn't make sense.  How can you run 'everything' through credit cards and have nearly all but one of them report $0?

 

3a.  That's why I said that I only charge a book or dvd to one token credit card, because I violently object if my scores are lowered without a valid reason.


I'll answer 2a. You pay the balance on all but one card before the statements post so that a zero balance is what is reported.



Yup. The name of the game is control your reported util. You can use your cards as much as you want. Just figure out when they report, and what figure they report. In almost all cases nowadays, CCC's report the night that your statement drops, and the amount that they report is the amount that shows as due. If you pay it off before the statement drops (= posts), then the amount due on the statement is $0, and that's what gets sent to the credit bureaus.

 

1.  "Surprising. I get an alert when I use my CC for the first time in a while, but it doesn't affect my scores."

1a. What kind of alert?

A Scorewatch alert. One of the flags that you can choose for alerts is activity on a card that hasn't been used in a while. It's actually a security alert, in case someone has gotten access to your card and started using it. I used to think when I got these alerts that the usage had caused a score change, but there wasn't one, or it was coincidental. The alert was merely to say, Hey, this card is getting used again for the first time in a good while, and were you aware of it?

 

2. "I run everything (quite literally everything except my weekly offering at church, which is by check, and the occasional purchase of Girl Scout cookies) through credit cards, and I nearly always have all but one of them reporting $0.

2a.  That doesn't make sense.  How can you run 'everything' through credit cards and have nearly all but one of them report $0?

 

As MVV summarized above, and as I then blathered about above. Smiley Very Happy I regard my CC's as slightly slow debit cards. I don't use them unless I have the money in the bank to pay them off, or money coming in the next paycheck that's already budgeted for that purchase. That's how I can run a ton of money through rewards cards and get cash back. I love my 6% cash back on groceries and 5% cash back on gas, and I do NOT pay interest, and the cards report $0 every month, because I pay them off the day before the next statement drops.

 

3. It's true that if they all report $0, my score drops a bit, so I just let one report a balance.

3a.  That's why I said that I only charge a book or dvd to one token credit card, because I violently object if my scores are lowered without a valid reason.

And that does work when you allow cards to report a balance, but it certainly cripples your use of credit. Try paying before the statement drops, instead of after, if you'd like to use your cards as much as you like without score penalties. Since for most people, having all cards report $0 results in a score drop, I do let one report a balance, and then I pay it off before the due date. (It's scary-easy to forget to pay it off, btw, so you do have to be alert about that.)

 

I started a new job recently, and with all the accompanying doo-dah and distractions, I let quite a few cards report balances. I never got anywhere close to being late, but just from having the balances report, my scores plummeted. Smiley Tongue Now that the dust has settled, I'm back into my routine of paying the day before the statement date.

 

Again, I will stress that this isn't necessary, unless you've gotten hooked on maximizing your scores. I can think of worse vices, though.

* Credit is a wonderful servant, but a terrible master. * Who's the boss --you or your credit?
FICO's: EQ 781 - TU 793 - EX 779 (from PSECU) - Done credit hunting; having fun with credit gardening. - EQ 590 on 5/14/2007
Message 10 of 26
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