Credit Card/Score question

[-Kev-]

I'm new to credit cards and credit score, I tried googling this but can't find anything concrete and recent.

My question is, if you pay a balance from a credit card before the due date is even determined, would this still be reported to the credit bureaus as an on time payment? Or is it better to get the due date and then pay it anytime after that (After knowing the due date)?

I'm trying build the score to mid 700s in 6-8 months, just want to make payments as soon as possible, even if it's like 2 weeks away from the due date. Would that still get reported? I read some where that if you make a payment too early that it'll just count as if you never used that amount you pay off early? That doesn't sound right. So if you use a credit card for a certain purchase, and then a week after you say what the heck, let me just pay off this purchase(Or at least pay something, like more than the minimum) and get it over with. So that won't get reported as an on-time payment?

[Underboss]

It counts as on-time payment, but it's better to wait for the due date to appear on your statement and then pay it 3 days before.

[-Kev-]

It counts as on-time payment, but it's better to wait for the due date to appear on your statement and then pay it 3 days before.

Why do you suggest 3 days before?

And how about the processing time for the creditor to charge your debit/checking account for the balance? Wouldn't that take like 3-5 business days, leading to a late payment and then a late payment fee+late payment gets reported?

[deliveryman]

As long as you make the payment on or before the due date, it doesn't matter. Most credit cards report to credit bureaus on a monthly basis, anyway.

I work for a bank and I'm not aware of anything that tracks how EARLY you made a payment in the monthly cycle.

What matters is the percentage of usage. If you're using more than 30% of your credit limit, regardless if you're making on-time payments, that's when your credit score begins to be affected. Obviously the higher the balance you keep on your credit card, the more it hurts your credit score.

They also look at things like applications to other credit products. If a credit bureau sees that you are applying for credit cards left right and center, that is a red flag, meaning that you are probably in a bad financial situation. Your credit score can take a hit for that too.

[Underboss]

Why do you suggest 3 days before?

And how about the processing time for the creditor to charge your debit/checking account for the balance? Wouldn't that take like 3-5 business days, leading to a late payment and then a late payment fee+late payment gets reported?

It takes 2-3 days for the payment to be done, that's the ''pending'' you get in your bank account statement, but it won't lead to a late payment/late fee because the credit card bank already took that money out.

It's better to pay your due 3 days before the due date because you face a less risk of paying late and hurting your score, 1 late payment will ruin your credit score.

[deliveryman]

It takes 2-3 days for the payment to be done, that's the ''pending'' you get in your bank account statement, but it won't lead to a late payment/late fee.

It's better to pay your due 3 days before the due date because you face a less risk of paying late and hurting your score, 1 late payment will ruin your credit score.

One late payment (by a few days) will not ruin your credit score.

[Underboss]

If you have a high score (730+) it won't hurt, but for people with low scores like me it hurts it.

[-Kev-]

As long as you make the payment on or before the due date, it doesn't matter. Most credit cards report to credit bureaus on a monthly basis, anyway.

I work for a bank and I'm not aware of anything that tracks how EARLY you made a payment in the monthly cycle.

What matters is the percentage of usage. If you're using more than 30% of your credit limit, regardless if you're making on-time payments, that's when your credit score begins to be affected. Obviously the higher the balance you keep on your credit card, the more it hurts your credit score.

They also look at things like applications to other credit products. If a credit bureau sees that you are applying for credit cards left right and center, that is a red flag, meaning that you are probably in a bad financial situation. Your credit score can take a hit for that too.

From my own research, everything you said is correct from your 2nd and rd paragraph, i'm following those guidelines currently. Utilization at around 25%, it's high vs national average but once I get higher credit limit it will lower.

Yep, the inquiries got me, I was an idiot. Got 4 of them in one week. But correct me if this is wrong, if you have a bunch in a 2 week span, I read that it's counted as like "shopping around"? It won't hurt your score THAT badly, supposedly. I monitor my score, and it seems like the 4 inquiries didn't affect me much, in fact I went up 20 points this month, no idea why since I went on a credit card application spree 2 weeks ago. Maybe they were reported but not counted so heavily?

[-Kev-]

It takes 2-3 days for the payment to be done, that's the ''pending'' you get in your bank account statement, but it won't lead to a late payment/late fee because the credit card bank already took that money out.

It's better to pay your due 3 days before the due date because you face a less risk of paying late and hurting your score, 1 late payment will ruin your credit score.

But don't you face even less risk if you pay it off like 1-2 weeks before? What penalty do you get for paying it off way before the due date, if any penalty?

[Underboss]

As long as you make the payment on or before the due date, it doesn't matter. Most credit cards report to credit bureaus on a monthly basis, anyway.

I work for a bank and I'm not aware of anything that tracks how EARLY you made a payment in the monthly cycle.

What matters is the percentage of usage. If you're using more than 30% of your credit limit, regardless if you're making on-time payments, that's when your credit score begins to be affected. Obviously the higher the balance you keep on your credit card, the more it hurts your credit score.

They also look at things like applications to other credit products. If a credit bureau sees that you are applying for credit cards left right and center, that is a red flag, meaning that you are probably in a bad financial situation. Your credit score can take a hit for that too.

I have a question. I bought an item that costed 3,700$ and the card that i used to buy it has a 6,000 credit limit. My score went down almost 20 points, if the use goes below 30% will my score go up again?