Goals towards a better score.

For just about anything you want to get off your chest about credit cards.
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ozjulian
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Goals towards a better score.

Postby ozjulian » Tue Dec 10, 2013 2:10 pm

Little background about me, 23 years old $35K income & current FICO score from Discover Statement 655

Current Debts:

BOA Cash Rewards $1900/$2000 7 Months Last CLI August 2013 from $900.00 to $2000.00
Discover IT $1500/$1500 2 Years Last CLI August 2013 from $500.00 to $1500.00
BOA AMEX Rewards $40/$300.00 5 Months No CLI

I normally pay off the card before the statement hits so in reality this is how they would look like before the cycle closes

$1000/$2000.00
$500/$1500.00
$20.00/$300.00

But come January, they would be all $0.00. In a perfect world I would assume my scores would at least go up once those debts go down to 0% Utilization. Correct?

Questions:

Should I leave my cards on at least below 10% Utilization for activity or just pay it outright to have them reporting $0.00 debt.

And how many statement cycles should I let them post as $0.00/>10% Utilization before I ask for CLI or Apply for new cards to ensure a more positive outcome.

Thank you in advance!


MemberSince99
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Postby MemberSince99 » Tue Dec 10, 2013 7:53 pm

You should for scoring purposes let an amount between 1 to 4% report on one of the cards. That's for the best possible score. Thus, if you care about that, then yes.


Right now with balances on all cards and 50% on one of them, that's undoubtedly holding down your score, especially on TU from FICO which punishes carrying balances (even tiny ones) on multiple cards. So yes, you would see your score go up to pay them all off, but for OPTIMAL results you want 1-4% on ONE card.


History isn't known with reporting so it doesn't matter how many cycles all you have to care is have they reported to the bureaus. If so, you're there. No one will know what your utilization was from the previous month once that happens (or care that I've ever seen).

ozjulian
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Postby ozjulian » Thu Dec 12, 2013 3:52 pm

Thank you again for the helpful insight! I am planning to follow your advice and will give you and update after 01/31/2014 and see where my score stands by then. Thank you again!

LianaCCB
 

Postby LianaCCB » Thu Dec 12, 2013 4:31 pm

You can keep your balances at 35% of the limit, and it will not affect your scores. If you go over 35%, then it will start to bring your scores down. Paying the balances before the statement hits is perfect - that way the lowest balance will always be reported to your credit.

Some lenders like Citi or AmEx will tell you they want to see 6 months of billing history before an increase, but other lenders like BoA and Chase are much more willing to increase only 2-3 months after a major paydown or something like that.

Also, if you make aggressive payments - always pay more than the minimum. Even if the minimum payment is $15 and you pay $20, that will be great. It shows the lenders that you have the means to pay down the cards, and you're not reliant on the credit.

Hope that helps! And good luck!



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