Will credit card payments have a new role in credit scores?

Tuesday, July 15th, 2014
Updated: July 15th, 2014
The content is accurate at the time of publication and is subject to change.

Today most consumers understand how to avoid their credit cards having a negative effect on their credit scores. They know that making every minimum payment every month on time, keeping balances below 30% of the card’s credit limits, and applying for new credit cards only when they need them will help them achieve a good or a great credit score.

But now a new factor might soon affect your credit score. Experts suggest that credit bureaus may start taking into consideration the amount by which you pay down your cards each month. One of the credit bureaus is already using this amount to calculate your score. Other bureaus and scoring companies may start doing this as well.

The aim of this is to differentiate between “revolvers” (carry balances from month to month) and “transactors” (pay down their balances in full each month). The theory is that transactors are likely to be more credit worthy. Therefore, they deserve higher credit scores.

If the credit bureaus do in future begin to differentiate between transactors and revolvers, it could end up credit scores being downgraded even if a consumer always make minimum or higher credit card payments on time every month. That could significantly change the consumers’ view of a plastic.

This could be bad news for credit card companies as well. It could result in fewer revolvers and companies might lose money.

Using your status as a transactor or revolver to help calculate your credit score may be just a beginning. In the future we might see all sorts of new factors affecting our creditworthiness. But for now, the factors that create a good credit score remain the same.

All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.

Latest Credit Card Fees News

Friday, September 4th, 2020

The other day Chase announced some changes to their cashback credit card lineup, introducing the Chase Freedom Flex credit card. The new Mastercard credit card boasts no annual fee, 0% intro APR on purchases for 15 months, and a variable 14.99% – 23.74% ongoing APR. Applications for the offer are supposed to be accepted starting […]

Tuesday, May 5th, 2020

While the coronavirus is in no hurry to calm down, people continue to look for any means to reduce costs so that not be left without means of subsistence. If you are an owner of the Chase Sapphire Reserve credit card, there is some good news for you that you may have missed. As part […]

Friday, January 31st, 2020

Thursday, January 30, 2020, all American Express Delta SkyMiles credit cards came out with renewed annual fees and/or benefits. Amex announced the updates back in September, but they were to come into effect only at the end of January. The changes apply to both consumer and business Delta SkyMiles credit cards. The first alteration is […]

Sunday, January 5th, 2020

Using credit cards, we constantly have to encounter different kinds of fees. So, during the 2019 U.S. News Consumer Credit Card Fee Study, hundreds of credit cards were examined in order to investigate annual fees, cash advance fees, foreign transaction fees, late and returned payment fees, and balance transfer fees more closely.

Friday, November 15th, 2019

On October 20, 2019, 9 powerful tornadoes swept through North Texas. Although, fortunately, they brought no casualties, many homes and public buildings, including schools, stores, and business centers, were damaged or even completely destroyed. More than 90,000 local residents were left without electricity. The damage is estimated at about $2 billion. To aid individuals and […]

Best Credit Offer
Best Credit Cards from Credit-Land.com
Check off the cards you want to compare. Then click the Compare link to go to the comparison table.
Consumer Rating: 5 / 5
Horizon Card Services Group One Freedom Card
Copyright © 2001-2024 BestCreditOffers.com All Rights Reserved.

*See the credit card's terms and conditions on the online application page. Note that this website may be compensated by credit card issuers when the visitor applies for a card through the links on this website. We do our best to maintain all information accurate and up to date. However, we do not warrant the credit card information won't change. Click the "Apply Online" button and review the current info on the secure credit card terms page.

Information in these articles is brought to you by BestCreditOffers.com. Banks, issuers, and credit card companies mentioned in the articles do not endorse or guarantee, and are not responsible for, the contents of the articles.

The BestCreditOffers.com webpage is a free service and an information resource for credit cards and financial products and services available to eligible United States consumers. BestCreditOffers.com does not offer any warranties and is not a direct service. There are no guarantees for approval or offers when applying for a credit card. Please refer to the application if you would like more information on each credit card. When you click "Apply" for a particular credit card, please take the time to review the terms and conditions of the product/service at the issuer's website. All logos on the BestCreditOffers.com website are property of their respective owners.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer. Opinions expressed here are the author's alone, not those of the credit card issuer, and have not been reviewed, approved or otherwise endorsed by the credit card issuer. Reasonable efforts are made to present accurate info, however all info is presented without warranty. Consult a card's issuing bank for terms & conditions.

BestCreditOffers.com makes every effort to keep information up to date and accurate. However, the information regularly changes and is presented without warranty. Therefore, we strongly recommend all our readers to visit the credit card application page by clicking "Apply Online!" button to review the detailed credit card's terms and conditions. Note that BestCreditOffers.com may be compensated by the credit card issuers when the readers apply for a credit card through this site.

BestCreditOffers.com is an independent, advertising-supported website which receives compensation from the credit card issuers and companies whose offers appear on the site. Compensation may impact how and where products appear on our site, including, for example, the order in which they may appear on the site pages. BestCreditOffers.com does not review or list all available financial or credit offers.

You've successfully subscribed!

Please specify the following:All these fields are optional

Thank you for providing this information! We will make sure our letters are useful for You.

User Generated Content Disclaimer: These responses are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.