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Is it best to use all credit cards each month a little?


sedge
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Hi folks,

 

First time post but I've been lurking for awhile and reading everything.

 

My scores are about 700.

 

I have 15 revolving accounts, 8 are credit cards. The other are store cards or other types of revolving.

 

I have $23k maximum available credit cumulative among the 15 accounts.

 

I never use more than 10% on each card and pay off the total balance at the statement date.

 

I have heard before finding this board that it is best to use each card a little bit each month and not to continue a zero balance on any card for very long so to show continued on-time payment history and responsible management of many accounts.

 

Is this true or should I just use a few of the cards and keep the rest at zero balances?

 

Thank you in advance.

 

Sedge

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You don't have to use every single card every month. Just use each card at least once every 6 months and you won't have any issues.

 

Also, don't wait until the statement cuts to make the payment. Pay before the statement cuts, so your statement shows a $0 balance.

 

To help maximize your FICO scores, you can let 1 card report a small $2 balance each month while ALL OTHERS report $0.

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A few more questions...

 

What credit cards (including store cards) do you have? What are the limits? Approx how long has each been opened?

 

Also, what are your reports like? Any negative accounts?

 

Where did you get your credit score from?

 

@EternalDebtSlayer--Thank you for your response.

 

CITI DIAMOND PREFERRED--$2500 CL 2 years open

CITI THANK YOU PREFERRED--$2500 CL 1 year open

CAP 1 PLATIUM--$750 CL 3 years open

CAP 1 QUICKSILVER--$750 CL 2 years open

DISCOVER IT (blueish, grey silver colored-dont know which one) $1500 CL 1 year open

FIRST PREMIER PLATIUM-$400 CL 4 years open

FIRST PREMIER CENTENNIAL--$300 CL 5 years open

BEST BUY MASTERCARD--$300 CL 4 years open

 

WAL-MART STORE CARD--$2200 CL 2 years open

AMAZON STORE CARD-$2500 CL 4 years open

PAYPAL SMART CONNECT--$1000 CL 3 years open

MACYS--$1800 CL 2 years open

DICKS SPORTING GOODS--$800 CL 3 months open

KOHLS--$300 3 years open

CARE CREDIT $2500 CL 2 years open

 

I have two installment car loans with Wells Fargo (15% APR). Balance is $5000 and $11, 000. Original amounts were $15,000 and $25,000 respectively opened 4 years ago. 2 more years on each. I am able to pay those down considerably and asked in another thread if I should.

 

No mortgages or any other installment loans.

 

I had a huge jump in income 2 years ago from $40k/year to $300K/year.

 

myFICO credit reports:

 

EQUIFAX

FICO 8--710

FICO 5--650

AUTO 8--691

AUTO 5--663

BANKCARD 8--691

BANKCARD 5--641

 

TRANSUNION

FICO 8--697

FICO 4-693

AUTO 8--705

AUTO 4--712

BANKCARD 8--696

BANKCARD 4--676

 

EXPERIAN

FICO 8--703

FICO 2--636

AUTO 8--667

AUTO 2--663

BANKCARD 8--688

FICO 3-631

BANKCARD 2--636

 

DEROGATORIES

 

TU--NONE (I just had 2 collections removed. One that was a zero balance showed paid, original amount $72 from 4 years ago. Bounced check at a grocery store that fell through the cracks when I moved, and the other was a $100 hospital from 3 years ago bill that I did a PFD letter just last week.).

 

EQ and EX are still showing both of the above, but EQ just reported the $100 as zero. EX still shows it as $100 balance.

 

I just started this credit building quest the end of May. My scores were in the low 600s. I paid off all my CC balances and have kept them there. They have jumped fast. The worst factor was heavy use of credit but that is slowly being reported differently. Some of the high balances are still showing, but are dropping off daily and should be all at zero by the end of June. My CC balances are almost all currently at zero or near zero. The other factors that are currently affecting me are short credit history and inquiries.

 

For the past 5 years I have never been late on any CC or installment payment.

 

Immediate goals are:

 

1) Business line of credit--I want $70k

 

2) Purchase two new cars--$20k and $40K sticker. I will put 20% down.

 

3) Get a high-limit credit card with some cash back and/or travel rewards (Intending to pay off balances each month of course.)

 

I am hoping to get my scores into the VERY GOOD range in the next month or so. I know the Exceptional range will take some time.

 

I thank you in advance for any advice.

Sedge

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First thing you need to do is let all those balances report down. In the meantime, research all your cards and how to go about getting CLI's on most of them, especially the ones which don't require hard INQ's.

 

And get rid of those First Premiers

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The First Premiers are my oldest. When my credit score was 580.

 

I thought it wasn't good to close your oldest accounts.

 

I don't use them but I hate paying the annual fee.

 

I guess I could close the youngest of the two.

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The First Premiers are my oldest. When my credit score was 580.

 

I thought it wasn't good to close your oldest accounts.

 

I don't use them but I hate paying the annual fee.

 

I guess I could close the youngest of the two.

Close the First Premiers. It is a total rip off. Your age of accounts will include closed cards. Plus creditors see it for what it is... A card for high risk individuals. It will probably help you to close it. Don't give them another dime.
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Regarding researching which cards will give a SP CLI, any suggestions?

Research: meaning look around the board and see what's going on with your current issuers and how they do business regarding CLI's.

What action you will take if you get declined?

Will you be a ton more successful if you pay down your balances before you attempt CLI's?

Citi: soft depending on the wording you see on the CLI screen, every six months.

Cap One: soft every six months, straight to EO if declined

Discover: I don't think they give CLI's anymore (sorry that's too easy)

etc etc etc

 

Close First Premier instantly.

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For your current cars what does "pay those down considerably" mean?

 

Before you go out car shopping for your new cars, you may want to check Capital One auto loan rates. I know some people around here don't like them but they got me out of the double digit car loans. About three years ago I had an 18% Wells Fargo car loan for 1 month before I did the Capital One refinance. They got me down to 8%. I don't know the credit score right off hand but it was nowhere near 700. Definately under 650 EQ

Edited by deanmartini
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If you want car loans your best bet is probably a credit union many of them have new car rates starting at less than 2%.

 

For a high limit rewards card, think you should be looking at AMEX, Chase, BOA. You've a lot of lower limits right now, read up on "higher limits beget higher limits"

 

Maybe a Cap One Venture would start you off with $10k and act as a pry bar to higher limits with these and others.

 

Get some CLI on your current cards like Konrad suggested.

 

Close those first premier before paying them any more money.

 

Pay down all cards before applying for anything else. Use the $2 trick.

 

There's not much advantage to keeping your older car loans open, they don't contribute much to Fico scoring. I'd even pay them off completely if you have the funds available.

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My own experience: Not worth the effort to try and time your purchases, let a couple dollars report, etc. I have a thick file, and a few times a year I rotate through all the cards to keep them active. I often make an online payment for the balance before the charge shows. My FICO has been over 800 for a very long time in the process.

 

If you get lucky and time things perfectly, you might see a small bump in your score. But since a score is a snapshot in time, it's only temporary. You'll drive yourself to drink trying to do the same every month.

Edited by Burgerwars
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I made a calendar timeline of all my closing dates. all cards are paid off completely now, and I'm going to use one of them for the rest of the month that closes towards the end of the month, and pay it off all except $200 which will be one percent of my total available credit

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good point dean about crap one i wanted to use them but they dont do the blank check anymore for a car loan they said apply if approved go to dealer then fill out credit app. why would u apply with lender a get approved then have to go to dealer to get your credit shopped it doesnt make sense to do that.

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