when to make a credit card payment

[fatjay]

So I got a CC and I will use it from time to time to buy gas or other small itmes.....do I come home and send a payment that day or wait till I receive a statement in the mail?

What is better for rebuilding credit?

Thanks
Jay

[IBroke]

So I got a CC and I will use it from time to time to buy gas or other small itmes.....do I come home and send a payment that day or wait till I receive a statement in the mail?

What is better for rebuilding credit?

Thanks
Jay

To rebuild credit, it actually doesn't matter as long as you stay current.

[Logan]

So I got a CC and I will use it from time to time to buy gas or other small itmes.....do I come home and send a payment that day or wait till I receive a statement in the mail?

What is better for rebuilding credit?

Thanks
Jay

You should wait for the statement otherwise your balance on your credit report will always say 0. Make sure you pay on time.

Logan

[fatjay]

You should wait for the statement otherwise your balance on your credit report will always say 0. Make sure you pay on time.

Logan

But isnt that a good thing??? or is unused credit not helpful? and 0 is that impression that gives?

[IBroke]

But isnt that a good thing??? or is unused credit not helpful? and 0 is that impression that gives?

Well, I think we have to make adifference between "rebuilding credit" and getting the highest credit-score. If you want to rebuild credit first, the monthly balance on your accounts doesn't matter at all - just stay current. If you want to get the highest score at a later point in time, you want to have the best usage reported - and that's between 1-3% of your available credit - NOT $0. But there is no need to focus on that balance from day one on. You can do that any time.

[df04527]

Lots of varying opinions regarding credit rebuilding and the best way to do it but my opinion is that lenders look for new credit history. How well are you at paying what you agreed to every month, especially since your BK? Are you less riskier to them now? How do they know that?

I will always advise, re builders, to show a balance every month but make those monthly payments faithfully and in fact send them 5.00 more, send it 10 days before it's due date and keep the balance owed less than 30% of the limit - the lower the better. That is the biggest bang for your buck for re builders and over a 6+ month history.

For non-re builders, and there are many many scenario's of who these kind of folks are but typically they have established credit and credit histories, with no negatives. This group of folks do not need to be concerned, so much, with payment histories so paying the balance in full every month works for them. It does not work for rebuilders.

Rebuilding credit to me means rebuilding your credit score as well - the two go hand in hand.

Anyway - just some other thoughts on this incredibly thick subject.

[fatjay]

My plan was to use the card a couple times a month for gas and then when the bill came...pay it in full...what affect will that have? keeping in mind this is a very low limit card ($400) they do however state that they report monthly to the credit dept

[df04527]

My recommendation is to charge 100 bucks and over the next few months make the payments that are required. As the balance gets down - go use the card again -- keep it hovering around 100 or so and over a few months that payment history will begin to make a bigger positive impact on your scores.

You can also pay it in full every month -- my opinion though is that it will take longer to have postive impact on your scores.

[IBroke]

I can only repeat myself: The balance you are currently carrying on a card has NO EFFECT on the rebuilding of credit. In the long run, only making payments on time has. Your score won't be any higher if you "always" carry only 30% or less of your limit. You simply need to know WHEN you need the best credit score and that's when you want to carry the right balance.

I have two little CCs with a $300CL that survived BK and they are maxed out. Howerver, that doesn't matter at all since I'm currently rebuilding credit but not seeking credit. If I would be looking for credit right now, I would simply pay them down and my score would be just as good as the score of somebody else who is ALWAYS carrying that specific credit to get the best score possible. There is no need to be concerned about the "right" credit-usage if you are not planning on applying for credit in the near future.

Just stay current.

[fatjay]

I can only repeat myself: The balance you are currently carrying on a card has NO EFFECT on the rebuilding of credit. In the long run, only making payments on time has. Your score won't be any higher if you "always" carry only 30% or less of your limit. You simply need to know WHEN you need the best credit score and that's when you want to carry the right balance.

I have two little CCs with a $300CL that survived BK and they are maxed out. Howerver, that doesn't matter at all since I'm currently rebuilding credit but not seeking credit. If I would be looking for credit right now, I would simply pay them down and my score would be just as good as the score of somebody else who is ALWAYS carrying that specific credit to get the best score possible. There is no need to be concerned about the "right" credit-usage if you are not planning on applying for credit in the near future.

Just stay current.

Understood...thank you to everyone for their in put..I want to do things better the second time around!!!

[Logan]

Well, I think we have to make adifference between "rebuilding credit" and getting the highest credit-score. If you want to rebuild credit first, the monthly balance on your accounts doesn't matter at all - just stay current. If you want to get the highest score at a later point in time, you want to have the best usage reported - and that's between 1-3% of your available credit - NOT $0. But there is no need to focus on that balance from day one on. You can do that any time.

IBroke knows what's up...good advice.

[Logan]

I have two little CCs with a $300CL that survived BK and they are maxed out. Howerver, that doesn't matter at all since I'm currently rebuilding credit but not seeking credit. If I would be looking for credit right now, I would simply pay them down and my score would be just as good as the score of somebody else who is ALWAYS carrying that specific credit to get the best score possible. There is no need to be concerned about the "right" credit-usage if you are not planning on applying for credit in the near future.

Just stay current.

Someone who actually gets it. Your day to day credit score does not matter. Anyone who thinks it does is brainwashed by the media. If your credit cards are maxed out and you pay them off your credit score will jump so just like IBroke says, just make sure you're paying your bills on time.

Logan

[onthefence]

Thanks for the great information and clarity, as I have been wondering the same thing!

[fatjay]

Just like with comuter lingo, you need to speak slower for me to understand it sometimes....LOL..Thanks again!! Great information!!!! I love this place

[dumpinmydebt]

As someone who worked at a mortgage company, we always told people to wait for the statement, then pay in full. This was taught to us by a gentleman who has been teaching finance and proper credit usage for 30 years. Showing that you can pay OFF your bills every month shows stability and reliability to the creditors. The only person I saw with an 800 score charged like $100 every month, then paid it off in full every month. They had 2 credit cards and quite a few thousand in available credit.

They don't like to see someone who pays the minimum. You might as well get in this habit instead of starting one habit and then changing it.