Credit Refund and 30% of Max Limit?

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Credit Refund and 30% of Max Limit?

Postby AceH » Sun May 23, 2010 11:01 am

If you make a purchase the exceeds 30% of your total limit but about 50% or less than your total limit, and you have a Credit REFUND added to your credit card which makes your actual payment due LESS than 30% of your credit limit does this affect your credit score?

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Postby LTomBerry » Mon May 24, 2010 12:23 pm

It shouldn't. What matters on your credit score is the balance when it is reported to the credit bureau, which is traditionally the balance on your monthly statement. Since your actual payment is less than 30% you should be in good shape.
Of course there are various philosophies about what is a good utilization ratio - is it best to stay under 30%? 10%? Who knows exactly, but since you are not close to maxing out the card you're OK.
Some people (like me) game the system a little by making payments before the closing date. My card closes on the 3rd of the month and is due the 28th. So when I get paid on the 1st I immediately pay at least half the balance, so my ratio looks better. Then I pay the rest with my mid-month paycheck.

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Postby Mogul of Pineapples » Tue May 25, 2010 3:24 am

Don't pay too much of the balance. As LTomBerry points out there's a magic number/percentage range but no one knows for sure. My guess is staying between 10% to 30% of limit. If there are zeros for the monthly balance it looks real bad, like the card isn't being used. What I do is dust off all my cards 2x a year with some decent purchases. Recently I had a $13k charge and I split the amount between my five unused credit cards to show some nice activity on them. I'm paying them off in full as each statement closes but at least by having a couple thousand on each card and leaving it for a month, no one can tell me they aren't being used. I made the amounts different on each, random amounts, so they don't look suspicious. I think round numbers like $5,000 are viewed as balance transfers by someone viewing your credit record. Contrast that to an amount like $4,392.04 at the end of a month, it looks more like regular purchases in my opinion.

Another technique for one unused card I use is charging auto insurance on it to. Mine runs around $1000 every 6 months and I always charge that to my unused B of A card to show activity.
Last edited by Mogul of Pineapples on Tue May 25, 2010 3:29 am, edited 3 times in total.
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