Better to pay balance in full or keep a balance?

Discuss anything related to interest rates & fees, like balance transfer offers, low rate cards, annual fees, etc.
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Better to pay balance in full or keep a balance?

Postby Regnohspf » Wed Aug 01, 2012 7:28 am

So my dad's been telling me if you keep a balance on your card, it basically looks better to the creditors since they see you as a way of making money. is that true?

would keeping a balance make you look better?

does it make a difference to the creditors whether you pay it in full or not?

my Citi Forward has no interest for 12 months and ive been paying it off in full but we took a family trip this past month and the whole trip was charged on my card, so debating if i should pay it off in full again this month or not.
Wells Fargo Student Credit Card Visa - $1300 (February 2011)
American Express Zync Charge Card (February 2012)
Chase Freedom Visa- $2000 5% rotating (April 2012)
Citi Forward Visa- $3000 - 5x at restaurants, (April 2012)
Chase Sapphire Preferred Mastercard World Elite - $5000 (July 2012)

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Postby jeffysdad » Wed Aug 01, 2012 8:55 am

If it's interest-free, carry a balance. If interest is being applied, always pay it off if possible. Your credit score will take care of itself.
American Express: Blue Cash Preferred (groceries, 6%; gas, department store, 3%); Gold Delta SkyMiles (Delta Air Lines, 2 miles/dollar, free checked bag).
US Bank: Cash+ (utilities, phone, internet, restaurant, 5%; drugstores, 2%).
FIA Card Services: Fidelity Amex (everything, 2%); Fidelity Visa (everything, 1.5%).
Chase: Freedom (rotating, 5%); Amazon (, 3%); PriorityClub (IHG hotels, 5 points/dollar); Sapphire (not in use).

*All cards are registered with PriorityClub IDine program for 8 points/dollar at participating restaurants.

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Postby trumpet-205 » Wed Aug 01, 2012 12:39 pm

If your current APR is 0%, let the balance revolve so you can have some money sitting in the savings account.

Once 0% intro APR is over though, pay in full to avoid interest. Banks still earn money from you when you swipe the card.
In My Wallet:
Citi Forward (12/2010) | Citi TY Preferred (05/2011) | Chase Freedom (11/2011) | GECRB/PayPal (05/2012)
Discover it (07/2012) | AMEX BCP (09/2012) | TD/Target REDCard (10/2012) | Chase Ink Classic (11/2012)
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Postby DavidNY » Wed Aug 01, 2012 1:17 pm

What they said.

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Postby FutureBillionaire » Wed Aug 01, 2012 7:20 pm

Well, if you carry a balance, you want to make sure that it reports that you use no more than 10% of your available credit. Also, you only want to carry a balance on one or two accounts. Carrying a balance on multiple accounts can tell them that you are juggling spending and may drop the ball at any moment. Using too much increases your debt to credit ratio, and you don't want that either.
Gas: Discover It, Penfed Platinum Rewards x2, Chase freedom, Citi TYP
Plane tickets: CSP
Groceries: AMEX BCP, Penfed Platinum Rewards,Citi TYP
Clothes: Express, Amex BCP, Discover IT
Amazon: Citi Forward, Cash +
Restaurants: Citi Forward, Chase Freedom, Discover IT, CSP
Hotels and other travel: Discover Escape, CSP
Movies: BofA travel rewards visa signature(fandango), Discover IT, Citi Forward, Freedom
Bars, clubs, tomfoolery: CSP, Citi Forward, Discover IT, Freedom
Balance transfers: Kroger 123 rewards
Bill Pay: Chase Ink Plus, Citi Forward
Everyday spending: Bofa Accelerated cash rewards amex, Discover Escape

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Postby Money card » Wed Aug 01, 2012 9:52 pm

I would say it depends on how many cards you have and how often you use a particulr 1, your intrest rate.

so you have 5 lending cards and 1 premium card .

so let's look at your Citi forward card, for example let's say you charge 100.00 on this card and you don't plan on using this card for another 8months, you paid the minimum of 20.00 it would be ok to leave a balance since you have 4 other cards and 1 premium card.
but if you charge 100.00 and 3-4 months you plan on going to a restaurant and a few other places using this card and charging more
I would then pay the the bill in full.

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Postby Daniel » Tue Sep 18, 2012 7:00 pm

I would like to add to the discussion. It is generally the consensus that one's credit utilization on a basic FICO score from the three bureaus and the vantage scores from any of the three bureaus does not require one to keep a balance on your cards. Many sources, such as one of the many score sites like quizzle, creditkarma, or credit sesamie to name a few, state that this portion of the score only takes into account the amounts of debt used on your last monthly bill and total credit available on that same bill. Whether or not you pay the bill off every month, transactor types, or you carry a balance does not affect these scores.

I would like to note that I know of at least a few scoring models that are not commonly used that do try to take this type of information into account.

*disclaimer: I was at one point employed by one of the companies mentioned above, which is why I included competitors.

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