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Posted: Tue Oct 30, 2007 7:29 pm Subject: Using debit card only VS credit cards

I usually just use my debit card for purchases and use the online banker feature to pay bills. I have 2 Orchard Bank credit cards that I am paying off and 2 other credit cards with $200 limits.

My question is do I pay off the credit cards and just my debit card or charge gas and small items on the credit cards and pay off at the end of the month??

My credit score is a 628 and I want to continue to improve it. I know that it takes time.. I have some chargeoffs and paid collections that need to drop off. I'm assuming once they drop off, my score will go up??

Posted: Tue Oct 30, 2007 9:04 pm Subject:

kris....using your debit card will have no affect on your credit score at all. I believe your score in part is based on how much credit you have available that you do not use. That will make your score go up. So if you have a couple of credit cards never use more than a third of what your limit is. This way you always have available creit and that will improve your score. Also when negative info drops off it does improve your score too....

Posted: Wed Oct 31, 2007 4:03 am Subject:

Debit cards are very good for managing your finances,but do nothing for your credit. I would use the credit cards you have for everyday bills and pay in full monthly to show some usage and payment history on your credit reports.

Posted: Wed Nov 14, 2007 6:36 pm Subject:

Debit cards also don't give you the purchase protection that a credit purchase does. For a big purchase or anything you may want to bring back I'd recommend using a credit card when possible for that reason alone.

Posted: Wed Nov 14, 2007 6:59 pm Subject:

I agree with everyone here...debit cards are very smart choice when you want to make every day purchases, say for groceries, gas, buying something for yourself etc. it's essentially cash in your wallet and you're not using credit. on that part debit cards are GREAT! however, debit doesn't help your credit whereas your credit cards will. sounds like you're pretty well on track getting those paid off and the good thing is your credit limits are small enough to manage. Not sure what your plans are with the credit cards, but I know when i first got my orchard bank card with a $300 credit limit with an annual fee of course, I used it for small purchases then paid the balance off in full. Orchard bank was the first card that gave me a chance after i paid off my consolidation debts. I noticed that my score went up gradually, i was happy it went up. I think you're very smart to use your debit whenever possible. when you're able to pay the ccs off, then maybe make small purchases that are manageable and like Morningstar said, be cautious about approaching your 1/3 credit limit, and you should see a difference over time. looks like you're not only preserving your current score, but well on your way to improving it