Advice please...have money to pay down debt, want to use it intelligently

[JenniferinFL]

I don't believe that most credit cards make a practice of closing a card with a balance unless it is delinquent. If they are already balance chasing, they may continue to do so until you are in better financial shape.

My husband had something similar happen with his Citi-backed Sears card. Now that he's in great shape again, his limit is bumped back up again. But, at the time, if his balance was $700, his limit was something odd like $760. We paid it off last and it wasn't closed.

If you have access to your credit reports, you can see when a lender has softpulled your credit to check on you. Some lenders pull monthly, some pull quarterly, some pull every 6 months. Since you will probably be paying on these for awhile, you have time to wait on paying extra on BOA. I would pay everything else off first, then look and see if they've checked on you recently enough to see improved credit before paying them in full. Of course, you can also trigger a pull by asking for a credit limit increase. Obviously, I wouldn't do that until you're almost out of debt.

Best of luck!

I'm chipping away at debt myself. Not much fun.. lol

[SunriseEarth]

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@JenniferinFL wrote:

I don't believe that most credit cards make a practice of closing a card with a balance unless it is delinquent. If they are already balance chasing, they may continue to do so until you are in better financial shape.

My husband had something similar happen with his Citi-backed Sears card. Now that he's in great shape again, his limit is bumped back up again. But, at the time, if his balance was $700, his limit was something odd like $760. We paid it off last and it wasn't closed.

If you have access to your credit reports, you can see when a lender has softpulled your credit to check on you. Some lenders pull monthly, some pull quarterly, some pull every 6 months. Since you will probably be paying on these for awhile, you have time to wait on paying extra on BOA. I would pay everything else off first, then look and see if they've checked on you recently enough to see improved credit before paying them in full. Of course, you can also trigger a pull by asking for a credit limit increase. Obviously, I wouldn't do that until you're almost out of debt.

Best of luck!

I'm chipping away at debt myself. Not much fun.. lol

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+1.  

OP, they most likely won't close it before the balance is paid (so long as you're paying on time), but they could possibly close it once the balance is paid.   More likely, they'll just leave the account open with a lowered CL.

Since balance chasing is AA, I'd definitely get a free copy of your CRs, on the basis that a creditor is taking AA based off CR information.  

[dhb1313]

Will applying for a HELOC spook my current credit card lenders? 

[Kenny]

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@dhb1313 wrote:

Will applying for a HELOC spook my current credit card lenders? 

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What would the goal be for this new trade line?

[Kenny]

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@SunriseEarth wrote:

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@JenniferinFL wrote:

I don't believe that most credit cards make a practice of closing a card with a balance unless it is delinquent. If they are already balance chasing, they may continue to do so until you are in better financial shape.

My husband had something similar happen with his Citi-backed Sears card. Now that he's in great shape again, his limit is bumped back up again. But, at the time, if his balance was $700, his limit was something odd like $760. We paid it off last and it wasn't closed.

If you have access to your credit reports, you can see when a lender has softpulled your credit to check on you. Some lenders pull monthly, some pull quarterly, some pull every 6 months. Since you will probably be paying on these for awhile, you have time to wait on paying extra on BOA. I would pay everything else off first, then look and see if they've checked on you recently enough to see improved credit before paying them in full. Of course, you can also trigger a pull by asking for a credit limit increase. Obviously, I wouldn't do that until you're almost out of debt.

Best of luck!

I'm chipping away at debt myself. Not much fun.. lol

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+1.  

OP, they most likely won't close it before the balance is paid (so long as you're paying on time), but they could possibly close it once the balance is paid.   More likely, they'll just leave the account open with a lowered CL.

Since balance chasing is AA, I'd definitely get a free copy of your CRs, on the basis that a creditor is taking AA based off CR information.  

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 I agree!!

Use these links:

https://aa.econsumer.equifax.com/aad/landing.ehtml

http://www.transunion.com/personal-credit/credit-disputes/credit-reports-disclosures.page
http://www.experian.com/reportaccess/#requestReport

[dhb1313]

Goal is to pay off credit cards, use only one and PIF each month.  Ultimately could pay down debt faster because HELOC would have a lower interest rate.  Lower stress because managing all my debt in one place.

I'm not sure I can get a HELOC, but that's the idea.  Thought to apply at Signal credit union because i have a (inactive) checking account there.

[Anonymous]

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@SunriseEarth wrote:

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@dhb1313 wrote:

Thank you EVERYONE - I'm really impressed with the replies I'm seeing here.  

Sunrise, JenniferinFL, others too:  Could you please say more about your recommendations for a creditor that is "balance chasing" me?  (I'm understanding that as a creditor reducing my CL to the amount owed, continuously, while I'm paying it off...is that correct?)  I was sufficiently irked that I also thought of paying them last, but it occured to me that until my situation is under much better control, I want to receive balance transfer offers...the debt load is terrible, and my best chance of paying it off faster hinges upon reasonable interest rates...which is why i care about my fico score at all.

So...does that mean that I should pay BofA off sooner rather than later, so that they don't keep hurting my score?  I've noticed copycat behavior before between creditors, so want to try to counteract this if possible.  If they all did this, I'd be in even worse trouble...

Again, thank you for considering my situation.

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Your definition is correct.   The lender does this because they see you ask a risk and don't want you to charge any more on this CC.   BoA will likely keep lowering the CL as you pay them and could possibly close the account.   I don't think paying them off sooner would stop them from balance chasing, so I actually wouldn't recommend prioritizing them using your payoff amount.  

I still think the best way to get yourself out of debt is to pay off the highest interest amounts first.  

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BoA is known for doing this.

I agree with this though.