thinbrit

OK, it doesn't matter if you let that 10k card go to 10k, so long as the credit agencies sample your file the day after you paid it off.
BUT, if you use your 10k card regularly, and use that 10k balance often, it has been my anecdotal experience that that cards limit may well rise to 15k. You now have $15k of credit, and your score just got better.
In contrast using just 2k credit of a 10k card means the credit limit is raised much slower (again this is anecdotal), so your credit score does not grow as fast.

So, use your card often (and above 20%) to grow the limit, but then reduce its use prior to needing to apply for new credit.

Using 500 bucks of a 500 bucks card makes no negative difference than using 100 bucks of a 500 bucks card, its when you pay it off that makes the difference. Its transient value has no bearing. I'm not sure how simpler I can make this!

sambapink

I think this discussion just demonstates how incredibly difficult it can be to understand the US credit system. My credit score has taken a knock when I didn't expect it to and risen when I didn't expect it to either. Infact the card I just recieved I decided I would probably not really use that often. That will somehow go against my score, I'm pretty sure.

fatbrit

If you want your credit score to be high, follow the rules. Having 10k out on a 10k-limit card will lower your score. If you want more credit, phone them up and ask them to raise the limit -- it's far easier and won't mess your score up.

chartreuse

This is like watching Mr and Mrs Jack Sprat (but in the Mirror Mirror-verse) having a domestic.

You're both right. As FB (almost) says, you don't want a statement balance of more than 20% being reported. As TB (almost) says, you can spend more than 20% of your available credit, so long as you pay the balance down before the statement is run.

Simple.

AdobePinon

If you ever look at your full credit report, you'll notice that it lists your peak credit usage over various timeframes. So, even if your credit is sampled the day after you pay it off, a relatively complete credit report product will still show that you maxed out your credit.

fatbrit

Two problems:
1/ You have no way of knowing the date your file is reported. I suppose if you ran a different balance on your card every day over several months, you could work out when the batch job for your info is run.
2/ As AdobePinion reports, some card providers (BoA is one of them) provide more complex information to the credit bureaus than simply the balance and the limit.

chartreuse

Even having gone back through many years of SWMBO's reports, I've never seen anything other than a statement balance reported.

Likewise, while I've seen "High Balance" reported, that has always been the highest statement balance.

It would be interesting to see if there's any evidence that anything other than a statement balance is ever reported, or if that's just an assumption.

And, with all the serious stuff out of the way; who cares? The opportunity for the Jack Spratt reference was too good to pass up.

Dan725

If you are a tad above 20% utilization, I don't see that being a big drama. But for maximum progression of the score, best to keep it below it, as FB says.

One other thing to watch for as well with Piggybacking - make sure the card you have with your wife is joint responsibility, if possible. If you are just an additional user, it really doesn't impact positively on your score as far as I know, and can actually trip you up negatively.

For example, I have a credit card in my name with a 20k limit that hardly ever gets used. Wife has one with a 20k limit that we use allthe time - and I'm just a user on that one, as the company doesn't do joint responsibility.

Now, when I look at my credit report, however, I can see that even though the 20k limit on the wife's card is not reported on my credit report, the balance run up on that one is. So if the balance is 5k on the card, the credit report is putting me a 5/20k (limit on my card), wheras in reality, it should be 5/40k. Its akin to the credit card companies that don't report the actual limit of the card, which again skews utilization in the eyes of the rating people.

A good site you might want to try to keep track of your approximate score without spending any money is www.creditkarma.com - it pulls from transunion only, but its a neat site and you should see all the factors on there.

Trixie_b

Matt, I used a wells fargo card, pre-loaded with $300. I Kept it for a year and then they automatically converted it to a regular credit card with a higher limit and refunded my deposit.

My advisor said don't go above 50% of the credit limit, but with only $300 on the card I regularly did.
After 2 years, my credit score is in the high 700's and low 800's (different agencies), however, don't let a good score fool you. I applied for a store card to get an interest free deal and wasn't immediatly accepted because I'm still "new" (my assumption).

They still see me as risky.
However, when we applied for a mortgage in Aug 08, my credit raised the interest rate - so the hubster was on the mortgage solo. when we re-fi'ed in November, putting me on made no difference to the interest rate, so the mortage company was more "secure" with my rating by then