Why must the date your card balance is reported each month remain such a mystery?

This post originally appeared January 22, 2015, on CreditCards.com as “What day is my card balance reported to the credit bureaus?

By Barry Paperno

Dear Speaking of Credit,
What day does Wells Fargo Bank report to the credit bureau? — Tea

Dear Tea,
You’ve asked one of those simple-but-great questions that any savvy consumer wanting to closely manage her credit and credit score might want to know. After all, your Wells Fargo information on your credit reports can strongly influence your credit scores. And since Wells Fargo provides that information to the credit bureaus, it only makes sense you would want to know when they do this each month so, for example, you can pay down your balance as far down as possible by this date, which will minimize your credit utilization (balance/limit ratio) and maximize your credit score.

Then reality sets in. The process you’re asking about involves an interplay between banks, credit bureaus and credit scores, and doesn’t typically lend itself to simple answers, especially if the answers are to have value for you. If I wanted to give you the short answer, I would simply say that it probably takes every day of the month for Wells Fargo to report its tens of millions of credit card accounts to the credit bureaus and to have the bureaus record that data. See what I mean? Not very valuable.

What you probably want to know is when Wells Fargo reports “your” information to the credit bureaus, not so much in terms of what day on the calendar, but rather a date or range of dates you have access to and enough knowledge of the reporting process to be able to estimate when your latest information should appear on your credit reports and affect your credit scores each month.

In the following three steps I’ll describe the credit reporting process that originates with your Wells Fargo card statement and results in your credit bureau scores:

1. On or shortly after the date your monthly billing cycle is completed — the statement date — Wells Fargo or its third-party processing company transmits the card balance, credit limit, payment due, seven-year payment history and other account information to each of the three major credit bureaus: Equifax, Experian and TransUnion. Or, rather than report this information as of the statement date each month, some banks use a cutoff date unrelated to the statement date to send the data about your account as of that point in time. Additionally, they may use different cutoff dates for each of the credit bureaus. As you might imagine, under this latter system, it’s very difficult for consumers to manage the balances affecting their credit scores, particularly since these banks, of which, fortunately, there are very few, don’t tend to share these reporting dates with their customers.

2. According to each credit bureau’s own processing schedule, the information they receive from Wells Fargo is added to their massive databases of more than 200 million consumers. The credit bureaus maintain slightly different databases for different purposes, such as those used by lenders making new account credit decisions, banks using credit data to manage their existing accounts and consumers accessing their own credit reports and scores. These different systems within a single credit bureau are not always fully updated and in sync with each other as of the same day.

3. Since each credit bureau independently adds your monthly Wells Fargo information to its databases according to its own multiple processing schedules, your credit scores across each of the credit bureaus are likely to be impacted by this information on different dates each month, and in some cases, depending on the purpose of the score pull, on different dates within the same credit bureau.

For all of these reasons, and more, the best general advice you can ever get when it comes to managing your credit is to avoid worrying about how every dollar is impacting your credit scores at every point in time, as scores are like moving targets that are tough to micromanage. Instead, you can ensure you’re maximizing your score at all times, and at all credit bureaus, by making sure that for each card:

  • Your balance remains as low as possible, particularly as of the statement date each month.
  • All payments are received by the due date each month, without exception.
  • You only open new accounts when necessary, which should be a rare occasion.

Again, great question!

Have a question or comment?  Let’s hear it!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s