Is credit limit cycling ok?

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Credit Limit Cycling is OK until it is not OK.
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Old Feb 5, 15, 8:34 am
  #1  
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Is credit limit cycling ok?

Hi everyone,

I'm new to FT and this is my first post!

I was reading in another thread that you should never spend/MS more than your credit limit in a given month, even if you're paying it all down before the statement closes. For instance, if I have a 10K limit, and I spend 6 or 7K, pay it back, spend 6 or 7K more, pay back before the statement closes, without ever having a balance of 10K or more, is that ok, or will that hurt my credit score?

Thanks in advance!
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Old Feb 5, 15, 10:58 am
  #2  
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Why not post in the thread that is talking about what you are asking about?

It seems you have since found the MS forum. I alerted mods to move your post for you

http://www.flyertalk.com/forum/manuf...-spending-719/
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Old Feb 5, 15, 11:33 am
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I did a little digging and couldn't find it (I'll get better!) and I thought it was probably a noob question so I posted it here.

Thank you so much!
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Old Feb 5, 15, 12:35 pm
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Originally Posted by pipput1 View Post
Hi everyone,

I'm new to FT and this is my first post!

I was reading in another thread that you should never spend/MS more than your credit limit in a given month, even if you're paying it all down before the statement closes. For instance, if I have a 10K limit, and I spend 6 or 7K, pay it back, spend 6 or 7K more, pay back before the statement closes, without ever having a balance of 10K or more, is that ok, or will that hurt my credit score?

Thanks in advance!
I have this same question, but regarding an AMEX card (Hilton Surpass) in particular. I have two Redbirds and was hoping to charge most of my monthly limits to this card but it has a low CL. Should I just use it to meet the minimum spend and then wait to request a CL increase? (Have to wait 60 days from new account to request CL increase)
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Old Feb 5, 15, 12:36 pm
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I've never had an issue turning multiple times per month, but it probably is more risky than not doing so.

During my time with the Wells Fargo 5x promotion I turned that thing over 9x a month for 6 months with no issues.
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Old Feb 5, 15, 12:46 pm
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Is credit limit cycling ok?

I'd say the total credit limit for the card plays a factor. A typical non-flyertalking credit card user with a CL of $10k probably won't cycle thru that more than once a month. But one with a $2k limit might go thru it 2-4 times a month.
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Old Feb 5, 15, 12:56 pm
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Originally Posted by pipput1 View Post
Hi everyone,

I'm new to FT and this is my first post!

I was reading in another thread that you should never spend/MS more than your credit limit in a given month, even if you're paying it all down before the statement closes. For instance, if I have a 10K limit, and I spend 6 or 7K, pay it back, spend 6 or 7K more, pay back before the statement closes, without ever having a balance of 10K or more, is that ok, or will that hurt my credit score?

Thanks in advance!
Regular spending should be fine. When I first moved to the US I had a 6-figure income but with no US credit history I could only get a CC with a $500 limit. I would cycle through that thing multiple times every month, particularly if I was travelling. It had no adverse effect on me -- I was soon able to get cards with 5-figure limits with no problems.

None of this affects your credit score because it does not get reported to the credit bureaus. You can get a copy of your credit report and you will see exactly what is reported -- once a month, your balance is reported, as well as the status of your payments, and your credit limit, if you have one. They do not know if you cycled through your credit 5 times that month -- all they see is a snapshot once a month.

MS may be a different story, particularly if you are abusing bonus categories. It has nothing to do with credit score but the lender may not like it and shut you down. So you do not need to worry about the effect on your credit score, but you do need to worry about the effect on your relationship with that lender. Different lenders have different tolerances for different things, and obviously they don't publish any of this, so a lot of it depends on how much risk you are willing to take (ie, how much you care about your relationship with that lender).

You can look at the experiences of others, but there is no guarantee that a particular lender won't change their policies and retroactively apply them. From reading through these forums, I'd say that Chase seems to have a reputation for shutting a lot of people down (closing all accounts, including non-credit-card) although it's not really clear what causes it.
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Old Feb 5, 15, 1:04 pm
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Originally Posted by pipput1 View Post
Hi everyone,

I'm new to FT and this is my first post!

I was reading in another thread that you should never spend/MS more than your credit limit in a given month, even if you're paying it all down before the statement closes. For instance, if I have a 10K limit, and I spend 6 or 7K, pay it back, spend 6 or 7K more, pay back before the statement closes, without ever having a balance of 10K or more, is that ok, or will that hurt my credit score?

Thanks in advance!
In my experience, yes. My CL's are $10k-$20k with Visa/MC/Amex and I've purchased up to $80k/month with about 3 credit cards.
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Old Feb 5, 15, 1:41 pm
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Originally Posted by VegasGambler View Post

None of this affects your credit score because it does not get reported to the credit bureaus. You can get a copy of your credit report and you will see exactly what is reported -- once a month, your balance is reported, as well as the status of your payments, and your credit limit, if you have one. They do not know if you cycled through your credit 5 times that month -- all they see is a snapshot once a month.
Agreed that it doesn't affect your credit score, but only because the algorithms used to generate those scores don't take this into account. However, if someone actually pulls your credit report, of course they can tell. Look at that credit report again and you'll see that it also shows "Amount Paid". If you have "cycled", this value is greater than your credit limit. QED
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Old Feb 5, 15, 1:49 pm
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define "ok" and "safe". What one person can do safely and what another person can do safely are different quantities. Also, what one person is getting away with does not deem something "ok". It is very clear that credit card companies do not like you doing this in combination with MS. Very clear from the shut down reports and feedback from those. Just because most of us get away with it on probably a regular basis doesnt mean its "ok". Everything is "ok" until it isnt.... Do what you think is ok and dont worry about what everyone else is doing and their definition of ok. If you are not comfortable with the idea of being shut down, then play within bounds given to you.
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Old Feb 5, 15, 2:02 pm
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Originally Posted by Electroman View Post
Agreed that it doesn't affect your credit score, but only because the algorithms used to generate those scores don't take this into account. However, if someone actually pulls your credit report, of course they can tell. Look at that credit report again and you'll see that it also shows "Amount Paid". If you have "cycled", this value is greater than your credit limit. QED
I don't think that that's true.

My Experian report only shows "OK" for each month, and a single number which shows the amount of my last payment (ie, one number per account, not one number per month). There is no historical information there other than "OK", showing that I paid on time (the amounts are not there).

My Equifax report shows an 81-month payment history for each account, but these are all blank, even for accounts that I use a lot and pay off every month. I suspect that they only use those fields if you carry a balance. Or maybe they only use them for installment loans and leave them blank for revolving accounts. I'm not sure, but I do know that there is no info there for any of my CCs.

I don't have my Transunion report handy but I don't remember the total payments for a month being reported there either.
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Old Feb 5, 15, 2:14 pm
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Actually I pulled my Transunion report yesterday and it does list previous balance and amount paid, but not the credit limit.
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Old Feb 5, 15, 2:21 pm
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Originally Posted by pipput1 View Post
Actually I pulled my Transunion report yesterday and it does list previous balance and amount paid, but not the credit limit.
Does it show amount paid per month, or just the last amount paid? That's the only report I don't have a copy of right now so I can't check.

No credit limit reported? For a CC with a pre-set limit? Which lender?
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Old Feb 5, 15, 3:11 pm
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Originally Posted by VegasGambler View Post
Does it show amount paid per month, or just the last amount paid? That's the only report I don't have a copy of right now so I can't check.

No credit limit reported? For a CC with a pre-set limit? Which lender?
I just checked again... they do report the credit limit. It was in the text and not the table so I missed it. Also, it's the total paid per month, not just the last amount. And it reports the high balance for a given period of time.
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Old Feb 5, 15, 3:12 pm
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Experian:



Equifax:

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