is it true if you have pay your balance each month on ur credit you wont get a high credit score?

Question

i thought as long as you pay your bablances off each month or make all your payments you will have good credit? but somone told me they want to see you have a balance each month long term and that will give you a higher score because it shows you can pay over time, and if you pay your balances off each month to 0, your score wont be real high because your not managing a balence over time? my credit is 734
what can i do to get a 800 or 850? i have no debt, pay all my balnces each month, and if i have a remaing balabce i pay more than the minumum. but i only had credit for 3 years. so is having credit for a few more years going to make it got to 800? they said the average credit length is 15 years in the u.s. thats not fair if your young, you can only start getting credit when your 18. so i have to wait till im 30 to have a 850?

Answer 1

It is true that having a zero balance every month will not improve your credit score. Since credit card companies only report to the credit bureaus about once a month, each month you would have a zero balance. So according to the credit bureaus you don't use your credit. The bureaus would not know that you used it all month and then paid it off. It's best to carry over a small amount every month.

It is also very important that all your credit cards are reporting your credit limit, some cards like Capital One do not report credit limits and this can have a negative impact on your score because the credit bureaus want to see that you are using less than half of your available credit. If the credit bureaus don't know your limit than any balance you have can look bad.

It's also not a good idea to close old accounts that are in good standing. The older the account is the better, it shows you have a long history of good credit.

Answer 2

734 is an excellent credit score, especially for your age. With that score, you can get the best interest rates on anything.

The FICO score is designed to include many different factors, but many of them only have a minimal impact on your overall score. Carrying a balance that is 1/4 to 1/3 of the credit line available helps, but so does not using more than 1/2 of your available credit.

If I were you I'd relax and not try to have a perfect score. There are many other things in life that are more important. You have zero debt - keep it that way! That alone is a lesson, or principle, that many people never learn.

If you don't own a house, buying one will help. But don't buy one until you can afford it. Also, save a lot for an emergency fund. Experts say you should have 6 months gross income in liquid savings. Stuff does happen, and when it does you always need to have the funds readily available to pay off your debt. Also, think about retirement, now. It sounds stupid, but if you start saving for retirement now then you will be wealthy and very comfortable when the time comes.

The only two things you should ever pay interest on are real property that you live in and education. Now, very few of us actually follow that, but when you but a car, but 50%, 60% down and pay off the balance as soon as possible. If you cannot afford that, don';t buy that car!

You sound like a good candidate for American Express. They may be able to assist your with raising your credit score. American Express only wants to deal with those who always pay their bills on time, and have the resources and stability to do so.

Good luck!

Answer 3

From what I understand, it is impossible to get to 850.

Regardless of that, a good credit score is important but paying interest to get it even "higher" is just silly.

Answer 4

Whoever gave you that advice has no idea what he/she is talking about. Of course your credit score will be good if you don't have any debts.

Answer 5

Whoever told you this simply doe's not know what they are talking about.