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How Does Credit Card Balance Affect Credit Score?
Jewellnessa
post Apr 29 2010, 12:20 PM
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How does this affect your credit score:
Using credit card and always paying off balance right away
Using credit card and paying off balance after you get the statement
Using the credit card and making the minimum payments after you get the statement


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Eric80
post Jul 16 2010, 09:28 AM
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IMHO, the best choice is: Using credit card and paying off balance after you get the statement

if you pay it right away, what's the difference between credit card & debt card?

credit company wants you pay minimum, so they can earn high interest, but if you always pay minimum only, it defintely will hurt your credit.


QUOTE (Jewellnessa @ Apr 29 2010, 08:20 PM) *
How does this affect your credit score:
Using credit card and always paying off balance right away
Using credit card and paying off balance after you get the statement
Using the credit card and making the minimum payments after you get the statement



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juntistik
post Sep 15 2010, 07:42 AM
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There are a few different ways to maximize your credit earning potential on a credit card. The way I have been taught by successful businessmen is:

Have more than one credit card, NEVER CLOSE A CREDIT CARD, this will always negatively effect your credit score because your maximum amount of available credit is decreased

Try to keep your balance as close to, and below, a balance of 50%. having a balance of 75% of your credit limit will negatively effect your score, and while having a 25% balance is still a good way to increase your credit score, you can maximize the positive effects by keeping it about 40-45% of your limit

NEVER MISS A PAYMENT

these are the rules i try to live by. Just remember they want to reward people they make money off of (hence dont pay it completely off every month), yet they want responsible credit holders (hence keeping your balance low and managed)

hope this helps!
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cjscully
post Oct 25 2010, 01:30 PM
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First, there is a distinct difference between strategic use of credit cards to improve your credit score and use of credit cards to cover expenses or purchase toys you can't cover with cash.

If you're using credit cards to improve your credit score, I have found the following to be successful:
1. If you're just starting out and your credit cards have low credit limits, you want to make purchases that are about 30-40% of the credit limits and pay them off in full when you get the statement. The credit card companies report the last statement balance to the credit bureaus so even though you're paying off the card in full every month, it looks like you're carrying that 30-40% as a balance.
2. If your cards have very low credit limits but you've had them for over a year and never missed a payment, try to get the limits raised.
3. Never under any circumstances carry balances greater than your cash in the bank.

If you're using credit cards to cover expenses or make purchases you have a problem. You're spending more than you make. You need to either increase income or reduce expenses immediately or you will soon be drowning in debt you can't pay.


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naomibatac
post Jan 5 2012, 01:16 AM
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Personally, I consider credit cards as a financial tool to provide convenience and as a reference for future financial use such as loans. Therefore, I would also be concerned about my credit score. So, I would use my credit card regularly, pay off the balance in full each month to avoid paying interests and other charges, never miss a payment, and don't go beyond 40% of my credit limit.


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rcsoco
post Jan 6 2012, 05:35 PM
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lots of useless responses so far.....
40% will get you a really low score....
you need to figure out your total credit limit with all the cards combined....
if you have 3 cards and they are 5,000 8,000 and 6,000 limits...then you have a total potential of 19,000....
one on of the cards charge less than 10%.....so say 1,900 or less.....find out when the card reports to CA's
it is not when the bill is due....then the day after it reports, pay the balance off to avoid finance charges.
it will appear as though you have less than 10% utilization, which is what you want.....yet you really have $0 balances and no finance charges....
some other tips were useful....never cancel a card as it will do 2 things....lower your AAoC (average age of accounts) and it will up your utilization % as your max limits will go down.
always buy a fico score from the source as they are the most legit...another other site will give you a fako score.


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joymali
post Jul 18 2013, 11:55 PM
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If you donít pay your balances, then it will hurt your score and definitely decrease it. Your score will also be hurt if you exceed your credit utilization ratio. The best ways for credit cards to positively impact your score are to pay your balances on time and in full and to not exceed your credit utilization ratio, and your credit limit. For more details, you can visit http://www.artipot.com/articles/1391757/th...edit-rating.htm.
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ShadowWolf
post Sep 22 2013, 05:23 PM
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Using credit card only for emergencies is the best situation as credit cards are not a replacement for income.


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david wilson
post Nov 19 2014, 09:37 AM
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Your credit score is like a numeric grade thatís applied to your credit history at a specific point in time. The credit score is based on the information thatís listed in your credit report. Your credit report includes information about your credit cards and loans. Things like the account balance, payment history, credit limit, and age of the account are listed on your credit report. The credit score is calculated based on a formula that gives weight to different parts of your credit history.


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