Dear Dr. Don,
A few days ago I was talking to a customer service representative from American Express. He suggested something he said would raise my credit score an extra 20 points in six months! Can you provide some sort of validation to his claim?

I currently pay off my credit card every Saturday so I don't accumulate a massive bill by the end of the month. This helps me manage my money so that I don't see a huge wad of cash in my bank account and go and spend it all.

His suggestion was that instead of paying off the balance every week, I pay it off only once a month -- at the end of the month. His reasoning is that since American Express reports only the last payment made in the month to the credit agencies, having a large payment posted on my credit report is much better than having a small payment.

He said that if I did this over the next six months, it would raise my credit score by 20 points. Is what he's saying true ... or is he just full of BS?
-- Jonathan Germane

Dear Jonathan,
Credit scores are based on the information in your credit report. The credit scoring models use that information to assess the risk to the lender in extending you credit. Fair Isaac Corp. develops the credit scoring models for the three major consumer reporting agencies: Equifax, Experian and TransUnion.

While the scoring models are proprietary, the basic factors in the credit scoring model are shown in the graphic below.

Elements of a credit score

Because the credit scoring models are proprietary, I can't validate your American Express representative's advice to you. Instead, I asked Craig Watts, the public affairs manager at Fair Isaac Corp., to weigh in on the advice. Here's what he had to say:

The reader's question seems intriguing until you realize that credit reports don't say anything at all about payments -- such information simply isn't reported by creditors. So the American Express representative's theory is highly imaginative but has no basis in fact. If the reader pays American Express daily or even hourly, it will make no discernable difference to the balance shown on his credit report, which I suspect American Express reports monthly, come rain or shine. This is important, since the FICO score only sees what is on the consumer's credit report at the moment the score is calculated.

It's widely understood that creditors report to credit bureaus monthly or sometimes less often. I've never heard of a creditor who reports more often to a credit bureau, which puts another hole in the American Express representative's theory.

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