Kokopelli
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It is better to have balances that do not exceed 50% of your total credit line for an item. Having low balances is probably more important than making payments on time. High balances are an indication of a potential problem. On-time payments alone can be a false indicator as a payment on one account can be made from another, such as paying one credit card using another, so a more reliable indicator is the total outstanding balances owed on all accounts. |
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tim2honorgod
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If you use your card periodically and have a balance for a few months of the year, it is better for your score.
There are many variables that determine the actual score; Payment History, Usage < 50%, Amount of Credit vs Income, and other account status.
Example of good usage: Buy something for $100, pay it off in
2-3 months. |
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twostories
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Actually both are good credit practices. Carrying a balance and maintaining payments on time, shows good payment history and paying off a balance shows you are completing contract agreements and moving on down the Credit road. Just remember too much credit can work against you, so keep cards and notes at a level that you can handle. If you are on this track .....Great job! |
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auequine
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Paying it off is the best thing. Otherwise it is showing that you don't have the money to pay for what your bought...ie. you're living outside your economic means. It is also bad for your credit rating(i'm not sure why) to spend more than 75% of your credit limit. You should avoid spending that last 25%. Also haveing many credit cards that are inactive, like having a Gap card and only using it twice a year, doesn't help your credit rating. Hope this helps! |
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mcbarnes_1970
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Creditors will look at how much debt you are carrying versus your income. Available credit means you manage your debt well, but they also want to see whether or not you use your available credit. My recommendation is to use your card occassionally, but pay it off every month. That is the most responsible way to use a card. |
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dougzinboston
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Paying it off is best for your credit score, no doubt about it. Carrying a balance is only good for the credit card in the sense that they know it's active but not good for you since you're paying interest on the balance. Best thing to do is to charge something small once a month and pay it off immediatly. This way the card will never fall into "inactive" status (for which the credit card may cancel your card for inactivity) and you will always maintain good credit score since you're always paying your balance off in time. |
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wut's a girl 2 do?
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Paying off your balances is the BEST option to maintain a good credit score. Paying bills on time and not closing credit accounts a couple important points to keeping good credit. If you have multiple credit cards instead of closing them pay them off or transfer balances. Stick to one or two cards (the ones with the lowest financing rates). Also if you have high rates call the companies and try to get them to reduce the financing charges. Hope this helps. |
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G M
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It actually depends on your situation.If you have hardly any credit or have had bad credit in the past it is better to have a small balance on your card that you ALWAYS pay on time.This shows that you are capable of paying regularly.Obviously this is not for a credit card with a high credit limit.Even if your high limit credit card is empty they still look at how much credit is available to you and can deny you a loan since you have the potential to overspend on it.Smaller ones are better for this(such as a gas card or store credit card). |
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bradschuman
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Pay it off....it's okay to carry a balance TO A POINT...that helps you to establish credit...but pay it off...otherwise, you might look like a risk. |
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AB
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Definitely paying off your balance. You do not need to carry a balance to get a good score, it is best to make 1 purchase per month and pay that off immediately, as to keep your cc active and your debt to credit ratio low. |
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candy2025
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Neither, really. when it comes to revolving credit products the only thing that can change your score is bad things. Time is the only thing that raises your score.
A lot of the other answers your getting are in relation to what's called a Debt-Asset ratio. Chances are your credit card isnt' going to make much of an impact to that, and i think what your actually asking for is about your "Credit Rating", so the correct answer is just "dont be late with a payment" |
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gtofinancial.tomvoli
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Scores are directly affected by balance - credit limit ratios. The lower your balance...the higher the scores.
Here is some additional info. Hope this helps. |
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Mr. Smeef
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Paying it off obviously. Besides carrying a balance is more cost to you in the long run. |
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J.J.
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It's always better to pay of you debt's, but if you do have a balance, paying more than the minimum, and paying it off early , helps your score.. Late payments, non- payments, bankruptcies, and foreclosure's are what really hurt your score. Also , I heard the more credit you apply for brings down your score, doesn't make much sense, but if you ever get turned down on one of the applications that is a strike aganist you, and I am guessing the more you apply for , they might think you will end up with to much debt .. |
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hakeem
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Here's an article that might help you find out:
http://financialbasics.blogspot.com/2006/11/credit-reports-and-credit-reporting.html
Hope it answers your question |
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VATreasures
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If your balance is 0 you will have a slightly better credit score. You only need to use and pay off your credit card very occassionally to keep your account active. |
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krs451960lovesnlc
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Pay it off unless, you do not have any prior credit. They want to see payments made on time (they are real picky about that) for about 2 years. Good luck |
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canela
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Having purchased on credit, either card or major purchase like a car, will establish your credit rating. If you make payments on time and don't go delinquent you'll have a high score. Also, keep the number of credit cards you have to a minimum. The reason is that the rating agencies like TRW look at the possible amount of credit you have (not used) and consider that vs your income. If you have credit lines of $50,000 on several cards and an yearly income of say $40,000 your credit score will be lower even if you owe a small balance and pay on time. I know you didn't ask this but don't fall into the credit card trap. The interest rates are between 12 to 20 percent and it's easy to buy things you want but don't have the cash for. The next thing you know you're paying interest charges and the balance never comes down. |
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aaeon
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Having no balance and is best. Also, an appropriate amount of open credit is the best IE: if you make $50,000 and have $5,000 in open credit lines (unused) that is helpful, but if you have $65,000 in open credit lines (unused) that will hurt you. One thing I learned is to keep one or two thousand in the bank for "surprises" so that I don't have to rely on credit cards anymore. It is hard to save that up sometimes, but once you have it it is a wonderful safety blanket. I am sure you already know about paying your bills on time. Lastly, you can get a free credit report annually from the 3 major credit reporting agencies. Do it! Make sure that they show you are paid off, no debt collectors, or really old accounts that you no longer use. If there are, correct them. Then your credit will be as good as possible!
Good luck! |
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Maddy Waddy
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Maintaining a balance equal to 1/3 of your credit limit is optimal. Your credit score is based on several factors including how you actually use your credit and how you repay your debts.
See the site below for more information on improving your credit score. |
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Whatev' Yo'
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In truth, paying off a balance can work for you or against you. If you buy and then instantly pay it off, you may not get good credit because creditors will think you as non-profit and if you don't pay it off, it can incur heavy interest and lower credit scores. Your best bet is to have a small balance (maxed out credit cards are really bad...) and make a couple of payments before paying it off. And of course, make sure payments are on time... yadi-yada... |
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Mariposa
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Paying it off, as long as the account stays open. |
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squee
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paying off is definatly better |
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Lewis A
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paying off balances is better for your credit score. This is because it lowers you Debt to Income ratio. Also, it show financial responsibilty. Plus, if it is a Credit Card you pay of it lowers your Revolving Credit, which inturn raises your credit score. But still make sure to pay everything on-time, and don't have your Credit pulled very often, that lowers your score as well |
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