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Credit Card Question

It is good to establish credit. Carrying a small balance isn't a big deal and may actually help your credit score, but Im not sure if thats true.
 
Originally posted by: dmw16
It is good to establish credit. Carrying a small balance isn't a big deal and may actually help your credit score, but Im not sure if thats true.
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I'd rather have a credit score that's a few points less than pay thousands in interest over the course of a few years.
 
Originally posted by: tfinch2
That OP is an idiot.
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Agreed. Very much an idiot.

I honestly think there is more misinformation spewn about credit on the intarweb than anything else. Like it's some kind of mystic force and "I heard from my cousin's buddy's friend's sister" information somehow is believe as fact.

go figure.
 
Carrying a balance does not help your credit score.
Carrying a balance does not help your credit score.
Carrying a balance does not help your credit score.
Carrying a balance does not help your credit score.
Carrying a balance does not help your credit score.
Carrying a balance does not help your credit score.
 
Originally posted by: tfinch2
Originally posted by: dmw16
It is good to establish credit. Carrying a small balance isn't a big deal and may actually help your credit score, but Im not sure if thats true.
Click to expand...

I'd rather have a credit score that's a few points less than pay thousands in interest over the course of a few years.
Click to expand...

I bolded the portion you obviously didn't read.

And to the OP, you should just pay off your balance and be happy that you're not throwing money away 🙂
 
Here are some Clear Points
Just pay your statement balance every month - that way you dont pay no interest.

Carrying a balance or not carrying a balance DOES NOT MATTER. Your credit history shows the total revolving (CC) credit limit. Lets say you have 3 cards total of $ 15000. In your credit history it will always show as a revolving limit for 15000 - THATS IT - not how much you owe. This is because a creditor thinks that you can be in that amount of debt in no time anyways...

On your credit history it shows your monthly payments in terms of Paid in time or not paid in time and if late how long - month, 3 month or 6 months. THATS IT.
Next thing it shows if you paid minimum due or more than minimum due. Does not matter if you paid 1 dollar or 1000 over the minimum due.

Thats all it is about CC and Credit history. No matter how well you maintain your credit card balances - it will never help you in taking a loan. Only a loan on your history can help you in taking a loan. CC history is considered a revolving - which does not help ppl giving you a car loan or home loan.

Now every creditor/bank has something called a "behavior score" attached to every account you have. That score matters upon how much you pay and when you pay and will help you in getting a loan from the SAME orginization.
 
Speaking of spreading misinformation, if you don't know WTF you are talking about, you might want to consider NOT talking about it. While you're right that it's best to pay your balance every month, there is a lot more to it than just avoiding interest.

Originally posted by: andy04
Here are some Clear Points
Just pay your statement balance every month - that way you dont pay no interest.

Carrying a balance or not carrying a balance DOES NOT MATTER. Your credit history shows the total revolving (CC) credit limit. Lets say you have 3 cards total of $ 15000. In your credit history it will always show as a revolving limit for 15000 - THATS IT - not how much you owe. This is because a creditor thinks that you can be in that amount of debt in no time anyways...
Click to expand...
WRONG. That's not it. Your report does show how much you owe and it is VERY important. 30% of your FICO score is based on your utilization percentage. If you have 15k available and you are have a total balance of 7.5k, you are at 50% utilization and your credit score will suffer. In general, the lower the utilization the better. There are some people who claim that leaving a small balance will help your score by showing that you are actively using your cards. From what I've seen, there's not much evidence of this.

On your credit history it shows your monthly payments in terms of Paid in time or not paid in time and if late how long - month, 3 month or 6 months. THATS IT.
Next thing it shows if you paid minimum due or more than minimum due. Does not matter if you paid 1 dollar or 1000 over the minimum due.

Thats all it is about CC and Credit history. No matter how well you maintain your credit card balances - it will never help you in taking a loan. Only a loan on your history can help you in taking a loan. CC history is considered a revolving - which does not help ppl giving you a car loan or home loan.
Click to expand...
That's about the most ridiculous thing I've ever heard. WTF are you talking about? Of course maintaining a good payment history on your credit cards will help you get a loan. If you build a good history on CC's, you will have a higher credit score and you will be much more likely to get approved for loans, and at better rates, even if you don't have any other previous loans on your report.
 
Because of the unstoppable tendency of some people to comment incorrectly on this frequently-discussed topic, I have to say that DT4K is exactly right.

I want to know where people hear the myths about credit which keep showing up here.
 
Originally posted by: kranky
Because of the unstoppable tendency of some people to comment incorrectly on this frequently-discussed topic, I have to say that DT4K is exactly right.

I want to know where people hear the myths about credit which keep showing up here.
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I want to build my credit so I'm closing my credit cards. By not having so many cards, I will increase my score.
 
Here are the breakdowns:

* Payment history - 35%
* Utilization - 30%
* Length of credit history - 15%
* New credit - 10%
* Types of credit used - 10%

Edit: This is for FICO.
 
Originally posted by: kranky
Because of the unstoppable tendency of some people to comment incorrectly on this frequently-discussed topic, I have to say that DT4K is exactly right.

I want to know where people hear the myths about credit which keep showing up here.
Click to expand...

You can't blame people for not being experts. It's just irritating when people act like they are. I think a lot of credit myths started because nobody really understood how credit scoring worked so they kinda took a guess and those guesses got interpreted as the truth and spread. Even now, the way FICO is calculated is still not public. But at least they've given more general information about what helps and hurts credit and about what percentage of the score is based on what factors. But you can still find a ton of articles out there giving questionable and sometimes downright wrong advice.

The one good thing I learned about credit from AT was to go to creditboards to learn about credit.
 
Originally posted by: shortspanishguy
Here are the breakdowns:

* Payment history - 35%
* Utilization - 30%
* Length of credit history - 15%
* New credit - 10%
* Types of credit used - 10%

Edit: This is for FICO.
Click to expand...

where did you get those numbers?
 
For FICO utilization, does it matter about my utilization for each card or is it based on total credit utilization?

I currently have a high credit utilization due to a 0% BT APR for 1 yr and have no balances on any of my other cards.
 
Originally posted by: illusion88
Originally posted by: shortspanishguy
Here are the breakdowns:

* Payment history - 35%
* Utilization - 30%
* Length of credit history - 15%
* New credit - 10%
* Types of credit used - 10%

Edit: This is for FICO.
Click to expand...

where did you get those numbers?
Click to expand...

MyFico.com - Affiliated with FairIsaac
 
Originally posted by: Albis
For FICO utilization, does it matter about my utilization for each card or is it based on total credit utilization?

I currently have a high credit utilization due to a 0% BT APR for 1 yr and have no balances on any of my other cards.
Click to expand...

They will look at the card indivdually. my score was recently a 725.

I paid off a large balance on a card that had 85% utilization and my score jumped to 738.

I gathered this from Fatwallet and Equifax.
 
Originally posted by: shortspanishguy
Originally posted by: Albis
For FICO utilization, does it matter about my utilization for each card or is it based on total credit utilization?

I currently have a high credit utilization due to a 0% BT APR for 1 yr and have no balances on any of my other cards.
Click to expand...

They will look at the card indivdually. my score was recently a 725.

I paid off a large balance on a card that had 85% utilization and my score jumped to 738.

I gathered this from Fatwallet and Equifax.
Click to expand...

Thanks for the response. I've also seen people say they look at individual cards but I couldn't find the info at Equifax. Maybe I'll give it another look over later.

 
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