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How to increase my FICO score using credit card balances

Question:

I have credit cards and I always pay the balance in full each month. Any ideas how I can improve my FICO scores?

Answer:

The CC company reports your balance a few days before your new statement is created.

Let's say your statement is generated each month on the 12th.

Typically this will mean you have to pay by the 6th of the following month.

This also means that they probably report your balance on the 10th.


My experience:

Discover card, with exactly those dates as given above.

I pay in full every month, but on my credit report there's always a balance reported.


Solution:

Go to the CC web site and pay the card off 10 days before the new statement is going to be created. E.g. let's say I owe $2500 on the 31st, so I send $3000 on the 31st, to give myself some room.

On the 1st of the next month, my balance is $-500 (overpayment)

Around the 10th, when they report to Transunion etc, my balance should be $0, depending on how much I spend. (I use my CCs all the time, never cash.)


This way my credit report showed my CC with a $0 balance. All it required was that I paid 10 days earlier than necessary.


My Transunion FICO went simply by this trick from 740 to 784.


You can also obtain the exact CC posting dates by pulling your own report and look at each account, on which date the last update was posted.


Generated 12:01:01 on Sep 23, 2018