Does it look better on your credit to pay-off a credit card or does making consistent payments look better?

What people need to realize is that 75% of all credit decisions are made by using a credit score. IN a credit score the revolvng debt you carry weighs quite heavily. SO to carry a balance over 35% of your limit is VERY harmful to your score. Its actually best to stay with 15% or less of your limit. So if you have a $5000 card, anything over $1750 is going to hurt. Staying under $750 is best on a $5000 card. It is always the best to pay in full... you avoid interest.

So the answer is you should pay in full every month. Dont just pay them off and never use them. That wont show a payment history. Use them as needed, or a little, and pay them off monthly.

Good luck.

Credit rating is a combination of things.

They look at the ratio of outstanding balances verses income.

Number of late payments ( you really don't want those)

Other things counted are how long you had your job, if you pay other bills on time, the size of your family. It's really weird.

My advice is to pay off credit cards as soon as you can, because you don't want to have to pay that interest. A credit report only shows where you have credit, the balance, how long you had it, and how many late payments you had. Nobody but the credit cards care how fast you pay it off.

Consistent payments are far better, purely because if you pay your balance off in a lump sum, then the credit card companies don't make money from you. They like you to pay the minimum each month so they can stack interest on your account, (this is how they make money).

If you were to pay double the minimum each month, then they would see you as a low credit risk, and they would be inclined to increase your credit limit.

But! Be careful. Sometimes they increase it without telling you and before you know it you have $10.000 available on your card. This will increase the interest they charge you and increase the minimum monthly payment.

As for looking better, making regular payments always looks better as it shows commitment by you to repay your debt.

As long as you are "paying as agreed" you look good. However, the more money you owe, the worse you look. Therefore, the best thing to do is to pay off debt as soon as you can, especially credit card debt which usually has high interest rates. Pay of the highest rate debt first and then work your way down. In other words, owing a $1,000 and "paying as agreed" looks good, but owing $0 and "paying as agreed" looks even better.

Also, don't close accounts once you pay them off. The longer you have had open accounts the better it looks on your credit. If you close older accounts your credit score will drop immediately.

You won't see how you pay off

your credit cards on a report.

wheather you pay it all off or not,

what shows is when you DON'T pay.

It shows if you ask for credit and

are given it or not.

I think it shows if you have a lot of credit

card credit available

to you and you don't use it--

that looks good, to have access to money,

but not use it makes your credit score higher.

What shows is if you ask for credit,

are given it, and then pay it off,

whether it's furniture, a personal loan, etc.

Creditors don't see "good" credit card

credit because someone could max out their

card, and simply pay the minimum

payments forever. People can have lots of

cards, run up lots of bills, but not

really be able to pay much more than the

minimum, and that's not real financial

responsibility.

Creditors want to see what you do with

loans, not minimum payments.

Boy, some people have weird ideas.

It is better, and looks better, to pay it off as soon as you can. Paying it off little by little may seem like it shows commitment or whatever, but paying it off quickly shows that you haven't over-committed yourself.

I just paid off my car. I took out a 5 year loan, and paid minimum payments for the first year. Still had 85% of the loan amount outstanding. Over the next 6 months I paid off the entire remaining amount - and when I called up for the payout figure, the woman on the phone said to me, "You have an excellent rating with us. Are you interested in taking any further finance?"

It is smart to pay off when you can, and that is how they look at it.

it's better for YOU if you completely pay it off each time, because then you aren't wasting money on interest payments.

credit card companies like people who only put down payments, because those people are their bread and butter. how does a bank make money if everyone pays off their balance every month? then they wouldn't get any interest.

anyway, the bank might be annoyed at people who pay off their balance every month, but it is certainly never going to cause you problems. no one is every going to deny you a loan because your credit rating is too good. the people who LOOK BAD and should be concerned are the ones who don't make payments at all!

To get the best of both worlds, pay off your entire balance over 2 months. That way, you're hit with little interest, and you carry a balance that is reported. Repeat forever.

I just checked my credit score (not report). My score went down by about 40 points since I paid off 3 credit cards completely over the last few months.

This is such a scam.

Credit card companies see it as better (for them) that you make regular payments every month. Because that way, they can make more money off of you with the balance you carry over month to month.

Of course the advantage you have in doing that is that you don't put all your money right to your bills right away. You'll have some cash to play around with for other things.

The smart thing to do is to pay them off, no interest, no losses and it does show up on your credit report that you are consistently paying