Best to leave a small balance on a CC or pay it off to zero?

[spongebob_squarepants]

I'm getting close to paying off a CC that had built up a balance over time. I remember reading that when you pay a CC to $0 it works against you on your FICO, compared to leaving a small balance of, say $500 or less, and just making minimum payments on that. Is this accurate?

I've had the card over 10 years and it's a Platinum Visa with a decent rate, but I prefer to carry my AmEx Blue which I pay off in full monthly.

[joness0154]

Pay the thing off if you can. Don't close it when you're done paying it off though.

[mauslick]

seriously?

get rid of the balance and do not pay extremely high interest for any reason

who cares about their credit score, the whole country from the gov't on down has bad credit..

think about all the people that have gone into foreclosure, bankrupt, credit card debt, etc since 2002...............

does a credit score really mean anything any more?

[ChrisMD]

I remember reading that when you pay a CC to $0 it works against you on your FICO, compared to leaving a small balance of, say $500 or less, and just making minimum payments on that. Is this accurate?

I don't know where you read that but it is 100% wrong.

The important part for your score is that you are using the card and making payments on time. Whether your payments are for the full balance or not (but still equal to or greater than the minimum due) makes absolutely no difference to your score. None. Anyone who says otherwise is either lying or clueless.

Where it does make a difference is in how much interest you pay. Paying in full = no interest. Not paying in full = interest. Your choice, but I recommend not paying interest.

[Mosbius Designs]

It absolutely DOES NOT hurt your score to pay off the balance in full.

[Mosbius Designs]

seriously?

get rid of the balance and do not pay extremely high interest for any reason

who cares about their credit score, the whole country from the gov't on down has bad credit..

think about all the people that have gone into foreclosure, bankrupt, credit card debt, etc since 2002...............

does a credit score really mean anything any more?

Yeah, it means a lot. Try buying a house with crappy credit.

[dubsport87]

I've never had any cc debt and my credit score is right around 800, paying your bills on time will build your credit. Going into debt to build a credit score is foolish.

[MK2*GTI*GUY]

I sold my Evo 8 last year which paid that, and my last motorcycle off. The banks liked that because everyone sent me offers on new car financing for the following 6 months. In the meantime I left the Yamaha Card open.