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Question By
Luisfer1

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0 People Helped
Does paying all my credit cards in total effects my credit score negatively?

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Top Contributor
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NO, paying them off is always good

Although, paying them off before they report can be.  If you pay before they report then its as if you never used them at all, which is not what creditors like to see.

ideally, you want to pay the bill once the card has reported.  If you can,  let the card report a 0 balance every couple of months. 

I have several cards.  I put them into a rotation so that i only use one or two cards a month, then move on to another card. letting the cards with balances report the balance, payments then a 0 balance for a couple of months.  This seems to work best for raising my score.

Good luck

Top Contributor
269 Contributions
115 People Helped

Your total utilization should be somewhere above zero, but below 10% on the closing date (the balance on this day is what is reported to the bureaus). Remember, FICO isn't strictly a measurement of how responsible you are with credit; it's a tool for creditors to determine who is going to be profitable, yet not very risky. If you show a zero balance, that's only slightly better than having high utilization. You look great in terms of risk, but credit card companies don't make money off people who aren't using their cards, thus your FICO will be affected negatively. Show a small balance (under 10% utilization) for best results. 

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Reply by
JohnnyRain127

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557 People Helped

Yeah it's unfortunate that having all your credit cards report at zero balance dings your scores as oppose to have one card reporting 1~9% (5% is what usually use) and rest the cards at zero. Many ppl think it's voodoo or I am full of it when I tell them that.

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Of curse ppl don't need to micro manage their utilization monthly, just when they are preparing to apply for credit to squeeze few extra points.

Top Contributor
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My credit utilization jumped from 2% to 7% over the last week, and my score dropped 7 points.  It will now take a month to clear that up.

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