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stayingFocused

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Living off credit cards for the month, then paying off the full balance. Helping or hurting?
I have been trying this new approach to focus on paying off medical collections. Initially thinking I'll live off my credit cards for the month and pay off the balance before the due date next month; all the while paying off medical collections in cash during the current month. I'm very diligent about not using my credit card until AFTER the statement prints and is subsequently sent to the agencies (I thought this is the balance for the month, thus my score shouldnt change arbitrarily) so that each month I'm reported at a 20 or 30 dollar balance. However, with credit karma and the other credit monitoring services this may happen early in the month that I show an "increase" for having 0% credit utilization, but then mid-month my score drops again as I start using the card (again after my monthly statement is reported to agencies), as my report is updated based on the current balance at that time, and shows a 90 - 100% utilization.

It seems that following this strategy is hurting me on one hand, given the consistent point loss. But then I see a larger point gain potentially for paying off the balances every month and showing that 0 - 5% credit utilization. Any opinions on this strategy or scenario? I'm trying to buy a home, and from what I'm reading regular activity is good, but the monitoring software seems to penalize mid-month activity based on current balances rather than the same official statement balance sent in for the current or prior month. Thanks for your opinions.

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You shouldn't be utilizing more than 30% of your available credit at a time.  If you're using your credit cards to earn rewards, think about paying the cards down, or off,  bi-weekly. Then use the card(s) again to pay other bills, and then pay it in full before the end of the billing cycle so you're not paying interest.

I follow this strategy and now have over $100,000 in available credit.  

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