Does paying interest on your credit card get you a better rating?

mc29mc

Hi people,

I'm slightly confused from what different people say:

1) For example if you have £1000 and the end of your statement and you only decide to pay £500 off, then you get charged a small bit of interest on the £500 that helps your credit rating because the bank makes money from you and doesn't mind lending to you.

2) The second is pay off every month and the bank will see you as a lower risk?

What is actually true in these circumstances?

Thanks in advance.

redcard

It's not going to make a blind bit of difference.

aleph_0

Well, there's no such thing as a credit rating. There are probably lenders who rate behaviour 1 as negative because of risk; there are probably lenders who rate behaviour 2 as negative of profitability (but remember, they still get a percentage from your spend).

We don't really know how each lender makes their decisions, it's probably not something worth deliberately paying interest to try to manipulate, IMO.

jonesMUFCforever

No it just makes you poorer if you pay interest.

YorkshireBoy

It's not necessary to 'buy' a credit rating, merely 'acquire' one over time by staying within the T&Cs.