won't result in as profound of a score impact. The reason: The credit scoring model recognizes that your holiday shopping is atypical relative to the other months because it can see and consider how you normally use your credit cards.
If the scoring model only considered the snapshot in time after your holiday spending spree, it would factor that balance in and potentially cause your score to drop.
The ethical credit score hack
A logical question at this point would be, "what can I do to protect my scores during the holiday season if a lender isn't using trended credit data?" The answer is to use your credit card but make several payments during the month. You don't have to wait until the due date to make a payment on your credit cards. You also don't have to wait until the statement shows up to make a payment.
Assuming you haven't charged anything more, making multiple payments during the month will ensure that when your statement is generated it will have a lower balance. Since the balance from your statement is what's reported to the credit reporting companies and factored into your credit score, you'll go a long way to protect or even improve your score.
And the best benefit? You either won't pay any interest on your credit card or the interest you pay will be as minimal as possible.
MIND YOUR BIZNESS
consumer makes payments above the minimum amount required. So if you make payments on your car loan for more than is minimally required, your score could improve.
The most current version of the VantageScore credit score, VantageScore 4.0, does utilize trended credit data on your credit reports, and it is available to lenders now.
The impact of holiday spending
According to a recent poll from VantageScore Solutions, 37 percent of 2018 holiday shoppers plan to use credit cards for their purchases. That's great because you have very consumer-friendly fraud protections when you use your credit cards ... plus you might earn points and rewards! The drawback, of course, is the temptation to overspend and end up with large credit card balances going into the new year, making a payment for the full amount due challenging.
Large credit card balances can result in lower credit scores. The reason is because of the credit scoring metric known as "revolving utilization," which represents the percentage of your credit limits that have been used. According to the same VantageScore poll, the issue of utilization is not an unknown. Indeed, 84 percent of the poll respondents acknowledged understanding that spending a high percentage of their credit limit can hurt their credit scores.
Here's where a credit score that considers trended credit data can help you relative to a credit score that does not. If you historically pay your credit card in full, or pay more than the minimum consistently, your holiday overspending