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re: How to get FICO to 800?
Posted on 11/15/17 at 9:55 am to baldona
Posted on 11/15/17 at 9:55 am to baldona
How big of a deal is utilization really? My credit score is good but there's always room for improvement. I use the hell out of my Southwest card because I'm trying to rack up points for flights. So i guess my utilization is high, but I pay the balance off in full without fail every billing cycle. I don't know why this would affect me negatively. Should I be using it less and maybe split up my spending among other my other cards to lower my utilization?
Posted on 11/15/17 at 10:39 am to REG861
quote:
So i guess my utilization is high, but I pay the balance off in full without fail every billing cycle. I don't know why this would affect me negatively
Credit utilization is based on reported balance to credit bureaus. This is most commonly once a month reporting of your monthly "statement balance" So paying off "in full" has no impact on credit utilization if you have new charges afterwards
Identical Utilization Examples- 0% APR card
Scenario #1: $1000 statement balance, pay full $1000, charge $500, Final Balance: $500
Scenario #2: $1000 statement balance, pay $500 Final Balance: $500
Both of these accounts report final balance of $500 that will be factored into credit utilization despite "Paid in full" for scenario #1
quote:
Should I be using it less and maybe split up my spending among other my other cards to lower my utilization?
No, just pay your bill to $0 before your statement is released. Then your utilization will be 0% if your reported balance is 0%
This post was edited on 11/15/17 at 10:41 am
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