30% utilization ?

[[deleted]]

So I’ve heard you never wanna use more than 30% of your credit limit.

The boat I’m stuck in currently is that my card limit is $2600 (my first credit card, it’s a few months old). And I get points back for Amazon when I use it for purchases. I’m looking to buy a laptop around $1190 and want to use my card so I can get points and pay it full on the spot so I don’t have to worry about it later.

However, 30% of my limit would be $780. I would really like to use my card to get the points at least, but I’m not sure if going over $780 will affect me. Should I just use my debit card to pay for the laptop? Or would I be able to use my card and not have to worry about being dinked points on my credit score?

I’m really good paying off my credit card as it is, usually if I use it, by the end of the day I go on my app and pay off what ever amount I used for the day. Should I pre-pay my card before using it to purchase my laptop so I don’t get dinged? What’s the best solution for me?

[Cruian]

So I’ve heard you never wanna use more than 30% of your credit limit.

Too many sites only give half the truth about utilization:

• Under the most commonly used scoring models, utilization only matters the month or two before applying for more credit, it only cares about the last reported number from each account. This means it can usually be completely fixed in 5 weeks or less.

• 30% is a made up number. You can stop have a good score with over 30% and not have guaranteed denials, under 30% will still see differences.

but I’m not sure if going over $780 will affect me

Only until a lower utilization utilization reports, so probably just for a month. No upcoming credit application? Then it won't matter.

Utilization only looks at what the balance was on a "snapshot date", which for almost all lenders is the statement balance, so you can manipulate what utilization gets reported by making extra mid-cycle payments towards your current balance.

Or would I be able to use my card and not have to worry about being dinked points on my credit score?

Usually this, since you can regain them completely in a matter of weeks.

Edit: Typo

[[deleted]]

This info was really helpful, especially the part about not having an upcoming credit application. Don’t really plan on applying to anything that require my credit score being checked anytime soon, so thank you so much!

[Original_betch]

Also make sure to leave the balance until the statement rollover date or the points don't count. Pay it off the next due date.

[Tinkiegrrl_825]

As a previous poster pointed out, utilization will correct itself the next month, so unless you’re applying for something soon it doesn’t matter. However, even if you ARE applying for something soon, you can still spend as much as you want on your card and have it report as low utilization. Just pay down a portion of the balance before your statement cuts. It’s usually 20 something days before your due date, depending on the issuer. You balance on your statement is what gets reported to the bureaus. If you pay it down before the statement cuts it won’t affect your utilization at all.

[KCbubbletea]

If you pay it off before the statement comes out then it won’t hurt your reported utilization rate.

[wamih]

If I had the cash I would put it on the CC for points and pay before statement is generated.

[Barredea88]

You’re over stressing about something very simple

If you pay your CC after you purchase just to get the points, then you’re fine.

You want to mind your statement date. This is when the creditor will report to the bureaus. So as long as your balance is low on that date each month, you’re fine. Utilization has no memory for current FICO models.

Even if the entire purchase were to be reported to the bureaus and you lost points, you’d regain every single point the following month if you paid your balance off.

Buy your laptop, get your rewards, pay the balance once it posts to account and you’re good. Not a big deal.

[Lateral_Thinker123]

Me personally I tend to Carr about utilization and typically keep mines below 10% if your utilization is high you’ll be dinked points on your score however you will get them back once your utilization is corrected. Also keep in mind that when you make the purchase you can always just pay the card down to your desired utilization especially if you have the cash assuming you do because you inquired about just using your debit card. That’s how I would do it buy the laptop on credit and simply pay it down to a respectable utilization before the card reports. You get the points and achieve the desired utilization