credit limits dont affect scores right?>

Yes, per card utilization AND overall card utilization affect score; try to keep both (at the time of the statement) under 30% utilization. If need be, ask for a credit line increase instead of applying for new cards.

^ yea i already did ask for a line increase. I figured asking for double what my current limit was good. My other card has a lot higher limit. But they denied me.. I dont have an interest in opening up any other card. I have the perfect 3 card combo for my current spending habits/patterns. I just need my go to card to have a $5k limit rather then a $2.5k limit, so i dont hit the max on it.

Your utilization is based on the statement date. If you have a $10k limit and use $8k every month, and pay it off in full every month, it will show an 80% utilization, and looks just as bad as if you had put $8k on the card once and only make small payments. If you pay it off prior to the statement/closing date, it will show whatever the balance left is (if anything).

This isn't really that important unless you are trying to get a new line of credit or need your credit to look very good for a major event (new home purchase, etc.). In that case, just pay off the balance prior to the closing date and make it looks like a ~0% utilization.

Also, be careful about asking for credit increases. Some banks will flag this and it can actually cause them to close your perfectly maintained account for no reason.

Quote from bowlofturtle : I know the higher score you have the higher limits you have. Thats a given.

Not always true

Quote : BUT does the credit limit affect your score much.

They do to the extent of credit utilization

Quote : My understanding is they total up all your limits and then do the percentage of limit used and not per card.

Can't say this is or isn't true.

Quote : I dont carry a balance but i wait for the statments to show before i pay in full.

Paying in full is good but credit bureaus don't know that. They only know what is reported once every 30-45 days (sometimes longer) so your utilization is base on whatever number gets recorded on that given day.

Quote : is my FICO score seeing that i'm using 80% of one card and next to nothing on the others or 8% of my TOTAL.

Its whatever the bureaus see, not what the actual activity is on your card (see above comment)

Quote : I'm asking because i've had my $2500 for a year plus and i asked for a limit increase to $5k. I was declined this... because i have "too many accounts with them" I just happen to bank with them and hold a SINGLE credit card with them. My parents have a mortgage with them, but i dont think that should play a role.

What your score is and what the credit card company sees is totally different. Unfortunately these guys (since you have a card with them already) DO see the full picture. So if you're utilizing a huge percentage, obviously they know you are.

Quote from phonic : Your utilization is based on the statement date. If you have a $10k limit and use $8k every month, and pay it off in full every month, it will show an 80% utilization, and looks just as bad as if you had put $8k on the card once and only make small payments. If you pay it off prior to the statement/closing date, it will show whatever the balance left is (if anything).

This is WRONG. The credit card company reports to bureaus usually every 30-45 days (sometimes longer) but generally speaking within that time frame. Its whatever the numbers are at when they do the reporting. Not base on whatever the statement date/balance is.

Quote from torrention : This is WRONG. The credit card company reports to bureaus usually every 30-45 days (sometimes longer) but generally speaking within that time frame. Its whatever the numbers are at when they do the reporting. Not base on whatever the statement date/balance is.

I don't know what credit cards you have, but you are most certainly WRONG in your assessment. I have Amex (2), Chase, Citibank, BOA, Capital One (2) and various store cards and I pull all three CRs every month. Every single one reports the balance at the closing of the billing cycle as the "balance" for that month. Every. Single. One.

Yes, it usually takes some time after the statement closes (not 30-45 days, usually more like 10-15), but I know for a fact how it works, and it's not what you think. I pay all my cards off in full 99% of the time, so I know exactly what my balance was on the statement, and what it was the day after (when I pay - which makes it $0). And what I pay is what is reported. So for example, if that month my statements shows $3852.81 on Amex, and I pay it off in full the next day and only rack up $1000 between then and when it posts to my CR, it will still post as $3852.81.

In fact, there have been times that I paid my bill the day prior to the statement date, but it didn't get posted in time and while my balance was "$0" on that day, my bill still showed the full amount. And again, that amount was on my CR.

I would suggest you do some more research on the matter before trying to claim people are wrong. Maybe you only have some off-brand card that doesn't follow this guideline, but it is the industry standard.

I assume you are going to put together some argument about how I am wrong, so let me cite some facts for you...

http://www.creditcards.com/credit...e-1508.php

Quote : Although they can report more or less frequently, lenders typically report only once a month. When that happens, the bank reports if the last payment was made on time and the balance listed on the most recent statement, says Maxine Sweet, vice president of public education for credit bureau Experian.

http://www.bargaineering.com/arti...lance.html

Quote : Credit cards report your balance when your statement closes. They report it again when the next statement closes. They are snapshots in time with no information about what happens between those two moments. The reports are the same whether you carry a balance or pay off the balance in full, so carrying a balance does not improve your score.

https://www.wellsfargo.com/credit...on/reports

Quote : What’s in your credit report ....Your account balance (or the total balance of your last statement)

http://money.msn.com/credit-ratin...eston.aspx

Quote : you regularly use more than half your limit on a card, consider using other cards to ease the load or try making a payment before the statement closing date to reduce the balance that's reported to the bureaus.

Quote from phonic : In that case, just pay off the balance prior to the closing date and make it looks like a ~0% utilization.

Just wondering...I've read conflicting reviews and would like your opinion on this. I've heard that showing a 0% utilization all the time is also not good because it makes it look like you're not making use of your credit.


Is this true?


Thanks!

Quote from phonic : I don't know what credit cards you have, but you are most certainly WRONG in your assessment. I have Amex (2), Chase, Citibank, BOA, Capital One (2) and various store cards and I pull all three CRs every month. Every single one reports the balance at the closing of the billing cycle as the "balance" for that month. Every. Single. One. Yes, it usually takes some time after the statement closes (not 30-45 days, usually more like 10-15), but I know for a fact how it works, and it's not what you think. I pay all my cards off in full 99% of the time, so I know exactly what my balance was on the statement, and what it was the day after (when I pay - which makes it $0). And what I pay is what is reported. So for example, if that month my statements shows $3852.81 on Amex, and I pay it off in full the next day and only rack up $1000 between then and when it posts to my CR, it will still post as $3852.81. In fact, there have been times that I paid my bill the day prior to the statement date, but it didn't get posted in time and while my balance was "$0" on that day, my bill still showed the full amount. And again, that amount was on my CR. I would suggest you do some more research on the matter before trying to claim people are wrong. Maybe you only have some off-brand card that doesn't follow this guideline, but it is the industry standard.

Very interesting information that you have there. I am confused though. If I pay off my bills on time, then why would this affect my credit score? Let's say I use 50% of my credit limit for each billing cycle, but I do pay it off before the due date, why would this have a negative impact on me? I'm thinking of applying for another credit card, but I'm afraid that I might have a bad credit score not because I don't pay my balance off in full, which I do, but because I'm constantly using at least 50% of the credit that's provided to me.

Quote from lsquare : Very interesting information that you have there. I am confused though. If I pay off my bills on time, then why would this affect my credit score? Let's say I use 50% of my credit limit for each billing cycle, but I do pay it off before the due date, why would this have a negative impact on me? I'm thinking of applying for another credit card, but I'm afraid that I might have a bad credit score not because I don't pay my balance off in full, which I do, but because I'm constantly using at least 50% of the credit that's provided to me.

Having a slightly high D2C ratio is not a VERY bad thing, and in some cases unavoidable if you only have $X in credit lines but spend $X*.5 a month and pay it all off. But a quick "credit score" is going to be negatively impacted because it's not looking at how much you pay (in your case 100%) each month. However, this doesn't mean your going to have a score in the 500s (in and of itself), but you will be penalized a bit for it. This is one of my problems with the scoring systems - it doesn't take all the variables into account. If someone goes on a spending spree and uses $10,000 of their $20,000 available credit, and only plans on paying the minimum payments for the next 20 years, yes that it is a major red flag and their score should be reflective of that. But in your (and my) case, it's misleading.

But I wouldn't be too concerned about it. Assuming all the rest of your CR looks good, and you have a nice overall credit history, you should be fine with getting approved for more credit. Assuming of course that your overall credit lines don't overextend you too much. And with more credit, your overall D2C ratio will look even better. Worst case scenario, just pay them all off a few days before your bill is due, and that month your D2CR will be 0% .

Quote from the.J129 : Just wondering...I've read conflicting reviews and would like your opinion on this. I've heard that showing a 0% utilization all the time is also not good because it makes it look like you're not making use of your credit. Is this true? Thanks!

Yeah, I'm trying to figure this out as well. Wish there was a clear cut answer. I generate a bill just to show > 0% utilization. I hover around 1-3% utilization every month (got extended too much credit).

I don't want my credit lines getting decreased at any point due to low utilization, or for my credit score falling due to 0% utilization.

Quote from 1stbuy : Yeah, I'm trying to figure this out as well. Wish there was a clear cut answer. I generate a bill just to show > 0% utilization. I hover around 1-3% utilization every month (got extended too much credit). I don't want my credit lines getting decreased at any point due to low utilization, or for my credit score falling due to 0% utilization.

Yeah...because when I apply for a new card, they'd probably think that what's the point in giving me one, when I don't use any of my existing credit?

Quote from phonic : Having a slightly high D2C ratio is not a VERY bad thing, and in some cases unavoidable if you only have $X in credit lines but spend $X*.5 a month and pay it all off. But a quick "credit score" is going to be negatively impacted because it's not looking at how much you pay (in your case 100%) each month. However, this doesn't mean your going to have a score in the 500s (in and of itself), but you will be penalized a bit for it. This is one of my problems with the scoring systems - it doesn't take all the variables into account. If someone goes on a spending spree and uses $10,000 of their $20,000 available credit, and only plans on paying the minimum payments for the next 20 years, yes that it is a major red flag and their score should be reflective of that. But in your (and my) case, it's misleading. But I wouldn't be too concerned about it. Assuming all the rest of your CR looks good, and you have a nice overall credit history, you should be fine with getting approved for more credit. Assuming of course that your overall credit lines don't overextend you too much. And with more credit, your overall D2C ratio will look even better. Worst case scenario, just pay them all off a few days before your bill is due, and that month your D2CR will be 0% .

So should I apply for the new credit card now or just pay off this upcoming bill and wait until next month?

Quote from lsquare : So should I apply for the new credit card now or just pay off this upcoming bill and wait until next month?

Without knowing more information, it's impossible to say. What other cards to do you have, what are your limits and balances (respectively)? What is in the rest of your report (brief summary)? How long is your credit history? Do you have other types of accounts (real estate, car loans, etc.)? Etc.

If you have one card with a $1000 limit and have $500 as a reported balance, but your history is good, you probably won't have a problem getting another comparable card.

If you have $100,000 in credit lines across multiple cards and have $50,000 in cumulative balances, and only have a short credit history, unless you have verifiable sources of income and net worth, you might have a hard time getting a new card. The banks might be cautious, because:
1) Why do you need more credit if you already have so much.
2) You have a very high balance of debt.

Also, it depends on the type of card you are applying for. Some banks are well known to be more strict or more lenient about issuing cards.

And 50% D2CR isn't too bad. While this makes up a huge portion of your score, 50% is more of a cautionary flag. 80%+ is a bright neon red flag.