Credit Advice

Have a question? Have advice to share? The combined knowledge and experience of everyone in the Credit Karma community can help you. Enter your question or help others below to get started!

Question

Posted in Credit Report
Profile Image

Question By
Trappedinthesystem

4 Contributions
0 People Helped
High credit utilization - Why does it matter?
In today's world, one really can't live a "cash life". Between online transactions, travel, recurring billing, and rewards programs high utilization of credit cards is actually indicative of an active life, not living beyond ones means. I own a small business (LLC) and so my "business card" reports back on my personal credit report. On my business credit card alone I run $15-20K per month and pay off the card ($7,500 limit) twice per week. Yet, sometimes the credit reporting cycle catches me on the ray before I pay it off and flags me for "high credit utilization". I have NEVER carried a balance over to the next billing cycle. Credit industry - WAKE UP!

Your Credit Scores Should Be Free. And Now They Are.

View your scores and reports anytime.

SIGN UP NOW
All Responses

Results 1-3 of 3Results per page: 5 | 10 | 25Page 1 of 1   Previous | Next
Top Contributor
179 Contributions
332 People Helped
Most Helpful Response

.... Also

Helpful to 1 out of 1 people

Since you already have a LLC, just write a letter to the credit bureaus advising them of the EIN and company name.... open a checking account in that LLC name and apply for credit with the company EIN instead of your SS#.....

Then it's just a matter of safeguarding that credit line better than your own.  Meaning if you know you are spending up to the limits of the current amount of credit you have... you need to get more.  Use the company's credit (NOT your SS#) and get more credit at another bank.  Then simply pay attention to your balance at the time of reporting.  If your utilization is high on one card before it is about to report, use the other card, and pay off the one that is about to report.

Top Contributor
179 Contributions
332 People Helped

SEPERATE your assets IMMEDIATELY!!

Helpful to 1 out of 1 people

Why would you go LLC (Limited Liability Corp) and tie that to your personal debt?  That defeats the WHOLE purpose of going LLC in the first place....... Donald Trump has filed bankruptcy 4 (YES FOUR) times as a LLC and never once had to explain his own personal debt.  Why?  Because a LLC is a separate identity attaching the company's assets and debt together with a EIN (SS# for companies) for liability, tax, and credit purposes.  If you are attaching your personal debt to your LLC, if someone sues your company, they can go after your personal property as well as the assets of your company; which is the whole purpose of going LLC; to separate those liabilities.

Top Contributor
1884 Contributions
3672 People Helped

It is decades old

Helpful to 0 out of 2 people

The Big Banks don't want to change the system because it works to thier benifit. 

It is slow and moves at a snails pace, except when reporting your balances in order to gain as much interest as possible. 

I would suggest that maybe you should open a few more accounts to increase your available credit.  You may not need it, but it will help with those billing cycles. Other than that, it's the system we have to live with...

Results 1-3 of 3Results per page: 5 | 10 | 25Page 1 of 1   Previous | Next

Your Credit Scores Should Be Free. And Now They Are.

View your scores and reports anytime.

SIGN UP NOW

Reply to this Question

Write your response:
Enter Your Comments

The Credit Advice pages of the Site may contain messages submitted by users over whom Credit Karma has no control. Credit Karma cannot guarantee the accuracy, integrity or quality of any such messages. Some users may post messages that are misleading, untrue or offensive. You must bear all risk associated with your use of the Credit Advice pages and should not rely on messages in making (or refraining from making) any specific financial or other decisions.