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I have cash to BURN!

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Anonymous
Not applicable

I have cash to BURN!

A little back story. My credit was in the middle 700's until I was in a car accident and had a TON of medical bills. I had to charge almost everything and now my score is in the high 500's. Fast forward two years and I finally have some cash to pay off these bills. Using about 16,000 this is my list I have. These are all my credit cards which are most at the limit. 

What would you suggest I pay with the 16,000? 

 

1. Citi bank
Limit 10,000.00.   10.000.00
Interest $145

2. Us bank limit $6000.00 $5953.14. Interest $177.00

3. Discover $4500.00 $4464.52. Interest $80.87

4. Chase $5800.00 $5857.00. Interest $81.61

5, Chase $2500. $2470.56  interest $50.26

6. Capital one 1. $1150.00 $1087.51 interest $8.74

7. Capital one $2250 $2216.23. Interest $39.16

8. Capital one $750.00. $710.26  interest $14.24

9. Macy's $3000.00 $2122.18

Message 1 of 13
12 REPLIES 12
Anonymous
Not applicable

Re: I have cash to BURN!

I would pay highest APR first so you reduce interest accrual over time.  I don't believe in the snowball tactic of paying the smallest balances to get rid of them.

 

Pay highest APRs off and then keep paying whatever is highest every month with minimums on everything else.

Message 2 of 13
Grafton88
Established Contributor

Re: I have cash to BURN!

To best help your credit score I would look to pay down the amounts so they are under 80%.  Right now these look to the issuers as maxed out.  So your Citibank I would pay it down to just under $8000.  Your US Bank I would pay it down to just under $5400.  etc  etc  This will give you a good start and should show some immediate improvement in your scores.

 

Then I would look at the highest interest rates.

 

I hope you are feeling better and best of luck to you.

Message 3 of 13
negg
Frequent Contributor

Re: I have cash to BURN!

I'm from the school "pay off as much as you can", not pay off the highest interest cards first.  You could pay off about 6 cards with that money leaving you with 3 balances. Much easier now to control. Paying two cards will leave you with 7 balances and all that interest on those 7 cards. 

CSR.........11,900.......Delta Amex $11,200.........Marriott Rewards Premier $8000.......Discover IT $9700......Citi Preferred $8600.......Chase Freedom $10,800.....Barclay(apple) $11,600......BofA $1500.......Capital One $7400......FNO $9800......Barclay(Hawaiian airlines)$11,000......Citi Costco $15,000. June 1st 2013 0 credit cards and 575 fico. Today 117K in credit and 812 fico and ZERO INQUIRIES......ZERO. 2018 goal. 825 fico.
Message 4 of 13
ralvarez2678
New Contributor

Re: I have cash to BURN!

i agree with negg in that i would pay off some of those cards off completely like cards numbers: 2,3,5,7 & 8

 

Message 5 of 13
Anonymous
Not applicable

Re: I have cash to BURN!


@Anonymous wrote:

A little back story. My credit was in the middle 700's until I was in a car accident and had a TON of medical bills. I had to charge almost everything and now my score is in the high 500's. Fast forward two years and I finally have some cash to pay off these bills. Using about 16,000 this is my list I have. These are all my credit cards which are most at the limit. 

What would you suggest I pay with the 16,000? 

 

1. Citi bank
Limit 10,000.00.   10.000.00 (Come up with a payment plan for yourself)
Interest $145

2. Us bank limit $6000.00 $5953.14. Interest $177.00 (Pay in full)

3. Discover $4500.00 $4464.52. Interest $80.87 (Pay in full)

4. Chase $5800.00 $5857.00. Interest $81.61 (Pay in full)

5, Chase $2500. $2470.56  interest $50.26 (Come up with a payment plan for yourself to pay this off. Depending on how much extra income you have to spend, you can pay for example, $200 every paycheck, $400 a month, and be paid off in about 6 months. Whatever you are comfortable paying that is above the minimum payment)

6. Capital one 1. $1150.00 $1087.51 interest $8.74 (Pay in full)

7. Capital one $2250 $2216.23. Interest $39.16 (Pay $1662.39, remaining balance $553.84. Pay it off in two payments of $276.92 if you cant afford to pay the entire amount)

8. Capital one $750.00. $710.26  interest $14.24 (Pay in full)

9. Macy's $3000.00 $2122.18 (Pay in full)


 

Message 6 of 13
Anonymous
Not applicable

Re: I have cash to BURN!


@Anonymous wrote:

A little back story. My credit was in the middle 700's until I was in a car accident and had a TON of medical bills. I had to charge almost everything and now my score is in the high 500's. Fast forward two years and I finally have some cash to pay off these bills. Using about 16,000 this is my list I have. These are all my credit cards which are most at the limit. 

What would you suggest I pay with the 16,000? 

 

1. Citi bank
Limit 10,000.00.   10.000.00
Interest $145

2. Us bank limit $6000.00 $5953.14. Interest $177.00

3. Discover $4500.00 $4464.52. Interest $80.87

4. Chase $5800.00 $5857.00. Interest $81.61

5, Chase $2500. $2470.56  interest $50.26

6. Capital one 1. $1150.00 $1087.51 interest $8.74

7. Capital one $2250 $2216.23. Interest $39.16

8. Capital one $750.00. $710.26  interest $14.24

9. Macy's $3000.00 $2122.18


 

 

I'm generally in the school of thought of paying across the board to get it under 79% UTI or lower, but with you having carried these maxed out for up to 2 yrs you might be "balanced chased" ...that's where the creditors lower your CL to 50 bucks above bal as you pay.  So in this case I would pay off the highest one (Citi) and then payoff the 3 Cap Ones and apply that money you would have owed (on the cit, cap one) the next highest one (us bank) and at the same time keep making at least your mins on all others (better if you could pay more) . then each time you pay one below 59-29% UTI tackle the next one..but whatever you do..put those cards away!!

 

Good Luck

Message 7 of 13
Kforce
Valued Contributor

Re: I have cash to BURN!


@Anonymous wrote:

A little back story. My credit was in the middle 700's until I was in a car accident and had a TON of medical bills. I had to charge almost everything and now my score is in the high 500's. Fast forward two years and I finally have some cash to pay off these bills. Using about 16,000 this is my list I have. These are all my credit cards which are most at the limit. 

What would you suggest I pay with the 16,000? 

 

1. Citi bank
Limit 10,000.00.   10.000.00
Interest $145

2. Us bank limit $6000.00 $5953.14. Interest $177.00

3. Discover $4500.00 $4464.52. Interest $80.87

4. Chase $5800.00 $5857.00. Interest $81.61

5, Chase $2500. $2470.56  interest $50.26

6. Capital one 1. $1150.00 $1087.51 interest $8.74

7. Capital one $2250 $2216.23. Interest $39.16

8. Capital one $750.00. $710.26  interest $14.24

9. Macy's $3000.00 $2122.18


Looking at interest & amount owed I would pay off in this order

( 2, 5, 8, 3, 7, 1, 4, 6 )

 

 

Message 8 of 13
Anonymous
Not applicable

Re: I have cash to BURN!

My personal approach would be to pay off some of the cards such as the lowest limit and highest interest. Then to allocate the rest of the funds to pay down cards so they are no longer considered maxed out. For example...

1. Citi bank - Pay Down 3k
2. Us bank - Pay Off
3. Discover - Pay Down 1k
4. Chase - Pay Down 1.3K
5, Chase - Pay Down 750$
6. Capital one - Pay Down 500$
7. Capital one - Pay Off
8. Capital one - Pay Off
9. Macy's - Pay Down 500$
Message 9 of 13
HeavenOhio
Senior Contributor

Re: I have cash to BURN!

OP, could you give us the cards' APRs? With raw dollar amounts for interest, I'm afraid of making a mistake.

 

i agree with the advice above that suggests to "un-max" each card first. You can do this by getting them down to 88.9% utilization or lower, although giving yourself a cushion beyond that is fine, too. Un-maxing the cards would amount to about $3,500.

Message 10 of 13
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