Is there a best time to pay off credit card?

[Deleted User]

st999 wrote: »

Why? .

Because the CRA's will try and sell you score improvement products otherwise :rotfl:

The 30% myth is made up by the CRA's - lenders don't care about it

onlyfoolsandparking

!!! wrote: »

Because the CRA's will try and sell you score improvement products otherwise :rotfl:

The 30% myth is made up by the CRA's - lenders don't care about it

That's good then because I'm currently running at around 33%:D

[Deleted User]

onlyfoolsandparking wrote: »

That's good then because I'm currently running at around 33%:D

Uh oh.
Time to start paying Experian £15 a month!

onlyfoolsandparking

!!! wrote: »

Uh oh.
Time to start paying Experian £15 a month!

I did consider it once but then my brain re-booted and I decided against it:D

System

!!! wrote: »

Because the CRA's will try and sell you score improvement products otherwise :rotfl:

The 30% myth is made up by the CRA's - lenders don't care about it

Absolute rubbish. Lenders do very much care about your credit utilisation percentage. Some more than others. If you are consistently using 100% of your available credit you can bet your bottom dollar some lenders don't look on this favourably. The less of your available credit you use the better it looks to prospective lenders. If you are using it all or lots of it it looks like you are desperate for more credit.

phillw

beany_bot wrote: »

If you are consistently using 100% of your available credit you can bet your bottom dollar some lenders don't look on this favourably.

Right, but there is a difference between consistently using 100% and making sure you never stray over 30%. I'd just spend what is absolutely necessary on the card and pay the full balance on DD, that is what normal people do.

The statement balance and any payments made during the month are sent through to your credit file anyway, so they can tell if you're trying to game it by paying before the statement is produced. If I was a lender I'd look far less favourably on that than someone who uses half the credit limit every month and then pays it off a month later.

shortcrust

beany_bot wrote: »

Absolute rubbish. Lenders do very much care about your credit utilisation percentage. Some more than others. If you are consistently using 100% of your available credit you can bet your bottom dollar some lenders don't look on this favourably. The less of your available credit you use the better it looks to prospective lenders. If you are using it all or lots of it it looks like you are desperate for more credit.

Not if you’re clearing the balance every month.

[Deleted User]

Imagine you have a £1000 limit.

You spend £900 of this limit (90%).

You pay this off in full on the 5th of each month, but the lender reports to the CRA's on the 4th - it will show you've used 90% of the balance, but you haven't because actually it was paid off in full the following day.

Then the next month you only spend £500 - it will report to the CRA's you've used 50% - but then again, it was paid off in full.

Likewise if you spend the full £1000 because you bought something you needed - again it will be marked as 100% usage, but then paid in full when the next report comes around.

It will always vary month to month depending on how much you spend.

Al that matters is that you pay if back in full each month and it will be marked on your files as such - and potential lenders will see this and the utilisation will not be taken into account.

SlovakianGuy

Willing2Learn wrote: »

Please be aware that the first month's Direct Debit may not be set up in time. Make sure you look at your statement. If the Direct Debit is successfully set up then it will say so on the statement. You can pay the statement manually, before the due date, if the DD is not ready.

Yeah, I almost missed my payment to Nationwide when I set up a DD for the first time. It was the due date and still no payment (no money taken from my current account or any change on my CC balance). So I called Nationwide and they said I set up the DD after the statement date or something, so the first DD will go out next month. Then I paid it manually. I had just a couple hours left.

SlovakianGuy

sufcboy wrote: »

Hi all.
Recently got my first credit card to help build my credit history/score in preparations for buying a first house. I’m just wondering does paying the bill before my statement comes make any difference?, either positive or negative. And vice versa if I wait till the statement comes and then pay it does it make any difference? Or is it as long as I’ve paid it off in full before the payment due date it doesn’t make a difference?

You can make more than one payment per month if you want.
When I got my first CC, I sent an email to the card issuer and asked them what day of the month they report to credit reference agencies. They said it's usually on the 1st day of each month. I wanted to have a balance of around £350 to show on my credit report each month, so if I spent £450 that month, I paid off £100 before the end of the month (it takes a few days until the payment is cleared). Then the remaining £350 was reported to credit ref. agencies and put on my credit report. Later, when I got my statement, I paid off the remaining balance of £350 and started the new month from zero again. I checked my credit report the next month and the balance of £350 was on it (not £450 which I really spent). I thought it makes sense to have similar amounts on my credit report month after month as it may indicate some kind of stability (stable spending habits) but it probably isn't the case. I had payments on my credit reports like £358, £352, £348, etc. each month, it looked nice, but later I decided to simply set up a direct debit (full payment) and let them to take the money from my bank when they want. It's simpler, and also, having some direct debits is often a useful thing. For example, when I want to earn monthly interest on my Tesco account, I need to have at least 3 active direct debits on it. Or if I want to switch my current account and get a switch bonus, the new bank usually requires some active direct debits on the old account which is going to be switched to them.