Credit Repair VIP - The Credit Repair BLOG: Do not max out your credit cards.

Do not max out your credit cards.

Do not max out your credit cards.

     One of the ways the credit scoring algorithm looks at your balance speaks about an individual card.  If you are maxed on one credit card then that is one kind of negative. Depending on when the credit card company reports to the bureaus even balances that you proposed to pay off at the end of the month are susceptible and your limit will appear as being maxed out.

     Another negative is related to the total credit card lines you have available to you. So, if you have five cards and four have balances greater than 30% of the limit, then you're in trouble. This is why leaving zero balance cards open is a good thing.

Brian C. Aber

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17 comments • Brian C. Aber • February 21 2008 04:02PM

Comments

I am a victim of the 5 cards above 30% but some how my credit has been pretty dang good, but I am working on a home equity right now so I can pay them off faster and lower interest rate and boost my score higher.
Posted by Heather the Realtor - Orlando, Lake Mary First Time Home Buyers, Bank Owned Homes (RE/MAX Central Realty) about 4 years ago

Heather,

Glad to hear it!  It's much harder to keep good credit than it is to attain it!

V/R,

Brian C. Aber
Account Executive
HTDI Financial
877-877-4834 ext. 704
brian@htdifinancial.com


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Posted by Brian C. Aber (Dispute Suite) about 4 years ago
Does transferring balances to one with a lower interest rate make sense?  It gets so hard to get out of debt - one must try to pay them off when you get a large escrow to close.
Posted by Mary Aguilar (David Lyng Real Estate) about 4 years ago

Most people I know in Real Estate have the balance problem because we charge it now and pay later.

Posted by DeAndrea "Dee Dee" Jones (Blu Skyy Realty, The Hampton Roads Real Estate Lady! ) about 4 years ago

Mary,

It is a case by case basis.  If you need the highest score possible then the transfer wouldn't be advisable as a higher revolving balance will lower the FICO.  It also depends on how long that interest stays low.  Many credit cards offer an inital low rate and then jack it up to 10-20 % 6 months later ... sometime even more.

Brian C. Aber

Posted by Brian C. Aber (Dispute Suite) about 4 years ago
I can't figure out these crazy credit scores.  I had my 3 scores pulled about 2 weeks ago.  2 of the score were in the high 700s and the other was barely at 700.  Seems kind of wild to me.  These credit bureaus need to be more uniform in nature because their credit scores have direct impact over people's finanical lives.
Posted by Rob Arnold, metro Orlando full service, investor friendly & foreclosure Realtor (Sand Dollar Realty Group, Inc.) about 4 years ago
Very nice post! My score got knocked down about 35 points cause I took advatage of a low rate promotional.
Posted by Matt Yogerst - Metro Milwaukee Real Estate (RE/MAX Realty 100) about 4 years ago

Rob,

Unfortunately they keep their algorithms private and they obviously use different figures to come up with their "score."

Brian C. Aber

Posted by Brian C. Aber (Dispute Suite) about 4 years ago

How much does the historical utilization matter?  (ie.  if i max out everything 6 months ago, but now have payed everything off) or does it effect it at all?

 

Posted by Rick about 4 years ago

Rick,

 

Amounts Owed (30%). Have you maxed out your credit cards? High balances or balances that are close to your credit limit show financial irresponsibility and thus has a negative impact on your credit score. it is advisable to keep your balances below 30%.

Brian C. Aber
Senior Account Executive
HTDI Financial
877-877-4834 ext. 704
brian@htdifinancial.com


Broker Referral Program

Start Your Own Credit Repair Company

Wanna Network Homepage

Posted by Brian C. Aber (Dispute Suite) almost 4 years ago

Thanks for these tips.

 Shiela

Posted by Sheila almost 4 years ago

Thanks Sheila!

 

Posted by Brian C. Aber (Dispute Suite) almost 4 years ago

Hi Brian. Thanks for sharing the great tip! Keep them coming.

Posted by Vicente A. Martinez Realtor Brooklyn | Long Island | Queens Homes (Prudential Douglas Elliman Licensed Real Estate Salesperson) almost 4 years ago

Thanks for the comment Vincent!

V/R,

Brian C. Aber

Posted by Brian C. Aber (Dispute Suite) almost 4 years ago

Brian, good advice. I always thought though that balances should not be any higher than 40% of the credit limit. I think this would make a great series for posting...keep it up. 

Thanks

Bo

Posted by Bo Hussung ~ Cogent Closing Associates, LLC (Cogent Closing Asso almost 4 years ago

Thank-you very much Bo!!!

Brian C. Aber

Posted by Brian C. Aber (Dispute Suite) almost 4 years ago

 

HTDI Financial was started with the idea that consumers should be able to do something about inaccurate, derogatory items on their credit reports.   We are proud members of the National Association of Credit Services Organizations.

Since its inception, HTDI Financial has been helping remove these derogatory items by challenging credit reporting companies and the methods they use to tarnish the credit for so many hard working people.

Posted by Brian C. Aber (Dispute Suite) over 3 years ago

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