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[quote=Anonymous][quote=Anonymous]There is actually a downside to having a credit card with a zero balance on it. Lenders look at your available credit limit, among other factors, so if you have credit cards that allow you to use $1000 of credit (for instance) even if you have used none of it (zero balance) lenders count that $1000 as money you COULD HAVE and count it against you. I was carrying zero balance cards, thinking it would show longevity and ability to keep them clean, and it came back to bite me. I was told by my lender that they were hurting my credit report and to cancel them immediately. I only had two. HTH.  [/quote]

No. A thousand fucking times no.  Your lender is confusing concepts in the worst way. The issue in your case was likely that you had too much available credit, not that you had a zero balance. The two are completely unrelated. Not having a zero balance doesnt change the fact that you still have $1,000 worth of credit available. Carrying a balance is not going to improve your credit score, nor will it improve your ability to take on new debt. In fact, the opposite is true. See Page 29 of http://files.consumerfinance.gov/f/201210_cfpb_CARD-Act-proposed-rule.pdf

"Reasonable policies and procedures to consider a consumer’s [independent] ability to make the required payments include the consideration of at least one of the following: The ratio of debt obligations to income; the ratio of debt obligations to assets; or the income the consumer will have after paying debt obligations. It would be unreasonable for a card issuer to not review any information about a consumer’s ?current obligations,? income, ?or ? assets [, or current obligations], or to issue a credit card to a consumer who does not have any [independent] income or assets."

The current obligation refers to debt load, which would include mortgages, auto loans, tax liens, credit cards, etc. In cases where the credit card has a non-zero balance, that debt is generally considered in the calculation.
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