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I would like to make a purchase on my credit card that is greater than 30% of my "available" credit. I pay down my credit card bills immediately after a purchase or if not that at the end of every day so as to keep myself under the suggested 30% credit utilization limit.

How should I handle the situation where I want to make a purchase that is more than 30% of my credit? Is it okay to go over the recommended 30% utilization if you pay the bill right away, or does the damage get done immediately?

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    Take a step back and ask yourself why you care about this so much. Are you in the market for a mortgage or a new car? If not, then as long as you're paying your bills on time, you don't have anything to worry about credit score related. Paying you credit cards daily is a waste of your time. – Todd Aug 16 '16 at 20:21
  • @Todd I am a very forgetful person, and finances (among other things) scare me quite a lot with how a lot of bad can happen with a single mistake. I've trained myself to pay the bill in quick cycles over the years to avoid this problem. It's not really obsessive, just something I do. – sethmlarson Aug 16 '16 at 20:27
  • If you pay off immediately - why not just go cash? Seems you have the funds - why even use a card - with cash you could also possibly do some bartering. – Blackbeagle Aug 17 '16 at 23:43
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Utilization is considered in only a snapshot. There is no utilization history and your past utilization has no bearing on your current score.

Repercussions of spending in excess of your credit limit will vary depending on card issuers. Some will let you pay the balance before the close of the day, some will charge a fee no matter what, some may even be more drastic than that.

If you've had the account open and in good standing with a solid payment history, it makes sense to give a call to have your limit increased.

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  • Again, same comment as the other answer, I am not going over my credit limit. I'm going over 30% of my credit limit which happens to be less than a purchase that I can afford. I hear that over-utilizing your available credit can lead to hits on your credit score. Thank you though for the additional information! I will give my bank a call. – sethmlarson Aug 16 '16 at 19:36
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    @Oasiscircle Then the first sentence of my answer applies. There is no utilization history. If you have 90% utilization your score will take a hit, if in the next month you're back to 10% utilization your score will see a boost. – quid Aug 16 '16 at 19:39
  • Okay, thank you, I did not know that utilization history was not tracked. I figured that banks would keep an eye on every data point they can get about your spending habits. – sethmlarson Aug 16 '16 at 19:40
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    @Oasiscircle Banks do track your utilization for internal credit-worthiness analysis, but that's an internal measurement that won't impact your credit score. – quid Aug 16 '16 at 19:43
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Consider three people. All have one credit card with a 1000 limit and no balance. All want to make a purchase of exactly 350.

Person A makes the purchase and within a week pays off his balance in full, well before the due date.

Person B make the purchase and waits until the last day before the due date to pay, but pays the balance in full.

Person C makes a payment of $10, the minimum, before the statement due date.

Person A & B have a credit utilization of zero. Credit utilization is figured on the balance that one carries. Provided the statement balance is paid prior to the due date, utilization is zero. Often times people make charges after the statement closes. Provided they make the statement balance, or more, utilization will still be zero.

Person C would have a utilization of 34% on this card.

How important is this? Do a google search. Within the top 5 answers, one claims that utilization is the most important thing for a healthy credit score, another claims that it has little bearing.

In conclusion: You can make the purchase without having any rise in utilization provided you pay the statement balance by the due date. Notions of gaming the system will only be meet with limited success.

Utilization is not the most important, paying your bills on time is the most important. A person with a high utilization that pays their bills will have a higher score than a person that owes a small amount but frequently misses payments.

Credit scores are dynamic and the goal for the companies measuring creditworthiness is to get better at predicting if a person will pay their bills. Expect things to change.

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  • It's not necessarily true that paying the balance before the due date will result in zero utilization. There is no necessary relationship between due dates and utilization reporting. See this question. – BrenBarn Aug 17 '16 at 3:35
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You're over-thinking this. Unless you really care about your credit rating right now (say, because you're buying a house) it's of no importance. I've gone past 90% utilization 3 times, next cycle everything is back to normal. The credit ding goes away as soon as they report the new, lower balance.

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