Brand New to the World of FICO

[makeitright]

I am brand new to this site and am amazed at the amount of information being shared !!  What a support system.  That being said....I NEED to improve my credit score.  I won't bore you with how I got here, I just need help getting out of here.  My EQ score on this site came in at 535.  My length of credit history is 20 yrs, there are 43 accts on there, 23 of them with a balance and 56 late pymts.  I got an alert yesterday that my score dropped to 457 when a creditor reported a balance increase.  I have a mortgage, a car loan, a personal loan and a lot of credit cards.  I just in the last 3 days paid 3 credit card balances in full and have enough money  to get rid of a few more.  Question.....as I can not pay off all the cards at 1 time do I pay off in full what I can and work on the rest one by one or do I make a partial yet substantial payment on all of them?  I guess I am wondering if my score will improve more with some cards paid in full or improve more with freeing up some credit space on all the cards...because they are all maxed.  I also wonder about closing the one's I paid off.  I will never use them like before so I have no problem closing them but wonder if that will hurt my score.  ANY advise you folks can provide is greatly appreciated.  Again...thanks for the great comments I've been reading.  P.S...I have no collections, bankrupcy's, etc.  This FICO is a direct result of my inability to manage my credit.

[Anonymous]

I'm fairly new myself, but if you haven't read it yet you should check out http://ficoforums.myfico.com/fico/board/message?board.id=generalcredit&thread.id=11303

It was a great help to me when I first visited these forums.

The thing that I have seen most commonly suggested would be to pay off as many cards in full as you can, starting with the highest interest rate card, as that is the one that is costing you the most each month.  As you pay cards off you then move on to the next highest interest rate rolling all of your available cash from the previously paid off cards' payment amounts until you get squared away again.

Hope that makes some sense, anybody can feel free to correct me if this is not the best course of action, but as far as I can tell it seems to be the most popular choice to pay down you CC debt.

Good Luck, and keep us updated with your progress!!!

[Anonymous]

Welcome & Good Luck...

Keep in mind that "Lenght of Credit History" is important, so before closing any card accounts keep that in mind.  If they don't have outrageous annual fees they will probably help your score to leave them active.   

You'll also read that a bal of 1 to 9% carried on your cards will be optimum utilization as far as your credit score is concerned.   That shows the reporting agencies that you can manage money wisely.

Sounds like you already realize it, but I would do as much reading here as possible, tons of great info and very experiance helpful people.

[Anonymous]

Welcome... Don't be afraid to ask questions and start your journey from the prospective of an educated consumer!

Rob

[Anonymous]

I recently heard that the credit card utilization go's in tiers like 1-9% is the best tier

then below 35% is the next tier, then 50% then 75%, I had heard that below 50% starts

the trend of showing responsibility although not as good as the 1-9% catagory so

maybe get them all in the utilization range closest to below 50% to 35% if you have as much cash

to do that on them all.

I am new too this site also so I would wait to hear from a pro though before qouting me...

[Anonymous]

Hi makeitright & welcome,  If you can afford to pay all CC off it will bring your scores up faster BUT..do not close any cards that do not have a yearly charge. you will receive credit on how old they are. age counts a lot. You may also pay down, starting with the highest int. card.this is what Im doing

discover  $9000    i make a double pmt.

juniper     $900      $300    when this is paid off I will then pay discover a double pmt + the $300 that I no longer pay juniper.

It doesn't matter who gets what  you score is the total UTIl of all CC

You score will show ever payment made,when it is posted.

You should use each CC every 3-6mo. small purchase  so that it shows on CR as good payment history

[Anonymous]

First, do NOT close ANY CCs. I don't care if the APR is 35% and they charge a $100 a year fee. We'll deal with that later. They are important leverage you can use to your advantage. Closing CCs rarely does any good, and often does harm. Never do it unless they are costing you money or a prime mortgage lender demands it.

Second, please post the CC info for all your open CCs. CCC, balance, CL and APR. Names of the CCC and the name of the CC can be important as multiple CCs from one company can sometimes be leveraged to your advantage.

Third, where are your lates and are they all legit lates?

Fourth, if you're concerned about having PIF CCs lying around, try this. Take an empty clean metal soup can, and stick the PIF CCs in the can. Fill it with water and stick it in the freezer. Empty OJ cans also work as they have metal. Metal means you cannot use a microwave, but hot water is a cheat one can use. Having them, but not having them immediately accessible is a good training tool, IMHO. Shows you that you can trust yourself to have them and not run 'em up to the max. Like getting used to standing on a steel girder 30 stories up--with a safety line.

[Anonymous]

---

Noah_Bodie wrote:

First, do NOT close ANY CCs. I don't care if the APR is 35% and they charge a $100 a year fee. We'll deal with that later.

---

Good Point, I hope I didn't mislead the OP.   If a card has an annual fee but is 20 years old it is definitely worth keeping due to it's age and dealing with the fee later. 

Most of my cards are recently acquired, but I have a joint CitiBank card that was opened in 1992 with my wife (now divorced).  Card reported lost long ago and no history reporting, but it still helps my score due to it's age.  Weird, but fine by me. 

ctRob

[makeitright]

This is what I have currently..

Capital One, 2460.00 balance, 2500.00 CL, 20% interest

Capital One, 1400.00 balance, 1500.00 CL, 19% interest

Sears, 800.00 balance, 900.00 CL, 29% interest

First National Bank of Marin, 1000.00 balance, 1100.00 CL, 23% interest

Aspire VISA 500.00 balance, 535.00 CL, 30% interest

Wells Fargo VISA, 2000.00 balance, 2000.00 CL, 22% interest

Delta Amer Exp 5800.00 balance, 6000.00 CL, 18% interest

The following I still owe on but they are closed:

BOA, 3161.00 balance 19% interest, CL was 4000.00

BOA, 800.00 balance, 19% interest, CL was 1000.00- BOA refused my request for a lower interest rate

The following I just paid off in the last week, are still open and they are in a coffee can in my freezer:

Wondering if and when this will make a difference to my FICO ?

Orchard Bank 0 balance 300.00 limit

Merrick Bank 0 balance 1900.00 limit

First Premier Gold 0 balance 400.00 limit

Centennial (First Premier also) 0 balance 400.00 limit

Household Bank 0 balance 700.00 limit

The majority of the 56 late payments are from 2001...I just send out some GW letters to see I can get rid of any of those.

So...with 5000.00 cash immediately available to pay off something I am wondering which direction to go.  Thanks again for everyone's help, advise and good wishes....this site is awesome.

[Anonymous]

Since the BOA CCs are closed, keep paying minimums for now. But, try calling and asking whether they would re-open. If they will re-open the CCs, you raise your total available CL. If they will re-open, post that info. I'll recrunch the numbers.

Your overall util is 77%, but after paying $5K on CC your overall util will be 49%.

Pay these amounts to these CCs with the $5K

Capital One with 2,500 CL - 1,231.59
Capital One with 1,500 CL - 662.96
Sears, - 357.77
First National Bank of Marin - 459.50
Aspire VISA - 237.12
Wells Fargo VISA - 1,017.27
Delta Amer Exp - 1,033.78

Then BT these amounts from your AMEX Delta to these CCs.

Orchard Bank - 147.41
Merrick Bank - 933.59
First Premier Gold - 196.55
Centennial (First Premier also) - 196.55
Household Bank - 343.95

The highly **bleep**-retentive numbers are because I'm using MS Excel to do the calculations. This will give you 49% util on all your open CCs. If BOA re-opens one or both CCs, your util drops further, and I'll redo the numbers.