Hanq

1 Contributions 7 People Helped

Member Since: January 2014

Most Helpful Contribution

Credit card utilization and your credit score

Sep 14, 2014
Helpful to 7 out of 8 people

Carrying an overdue balance and carrying a balance for the current month (or statement period) are two different animals. The credit card companies want to see that you can handle having a little debt (30 days worth, with up to another 30 days to pay)but also that you are able to pay that debt off.  

So in other words, if you pay your full statement balance from last month (and avoid the ridiculously high interest rates that come with not paying your full due balance) but keep your current month's balance until it comes due at the end of the month, you are keeping a balance while avoiding the dark side of the lending game.  I think of it as the credit card company is spotting you for 30 days. And you are earning rewards and building credit at the same time . Nobody needs to be paying interest in order to improve their credit score.  

Activity (1 Total Contributions)

Credit card utilization and your credit score

Sep 14, 2014
Helpful to 7 out of 8 people

Carrying an overdue balance and carrying a balance for the current month (or statement period) are two different animals. The credit card companies want to see that you can handle having a little debt (30 days worth, with up to another 30 days to pay)but also that you are able to pay that debt off.  

So in other words, if you pay your full statement balance from last month (and avoid the ridiculously high interest rates that come with not paying your full due balance) but keep your current month's balance until it comes due at the end of the month, you are keeping a balance while avoiding the dark side of the lending game.  I think of it as the credit card company is spotting you for 30 days. And you are earning rewards and building credit at the same time . Nobody needs to be paying interest in order to improve their credit score.