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Personal Finances / Credit Cards and Consumer Debt


Subject:  Re: does making minimum payments affect... Date:  5/31/2003  11:53 PM
Author:  Mark0Young Number:  161095 of 312161

I don't know if carrying a balance changes your FICO score or not

It doesn't. The credit report shows the balance and whether there has been activity, but not whether the balance was being paid off in full each month or the same balance is just being carried forward.

One's credit score (e.g., FICO score) is based entirely on the credit report. Therefore, the FICO score does NOT reflect whether one carries a balance or pays in full every month. However, it does reflect the reported balance. (Balances above 35% of one's credit limit aren't good, above 50% even less good.)

Now some creditors do their own evaluations on their cardholders, e.g., those who carry balances are more profitable than those who pay it off in full every month, so some creditors will want to keep those customers who pay the minimum but pay regularly.

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