Need Advice Please!

[Anonymous]

I have been reading this board on and off for a few months. I have about 15 credit lines.  5 are paid off in full, but I'm carrying balances on the others -- some of them pretty close to the credit limits.  Here is my dilemma: My scores are in the mid-600's due to high utilization on some accounts and probably student loan balances.

I am actually a bankruptcy lawyer.  My salary is around $100K and I have some money that I could use to pay off most of the credit card balances.  I will be applying for a business/personal loan in February or March 2013 to expand a business that my fiancee and I have.  The business has been very successful thus far.  I want to get the best rate possible on the loan or potentially put some of the business expenses on credit cards.  I would also like for my credit limits to increase.  How should I proceed with the following cards?  Also, which of the following cards do I have the best chance for a CLI once they are paid off and how long should I wait to ask?  Also, which cards could I potentially apply/qualify for with decent limits once most of these have been paid off?  Thanks for any and all help!

Bank of America w/balance of $4.8K and $5K limit.

Bank of America w/balance of $4.9K and $5K limit.

Capital One w/balance of $1.4K and $1.5K limit.

Wells Fargo w/balance of $1.4K and $1.5K limit.

Walmart w/balance of $400 and $500 limit.

Dell w/balance of $2K and $3K limit

CFNA w/balance of $1K and $2.2K limit

Lowe's w/balance of $2.7K and $3K limit

Bill Me Later w/balance of $400 and $500 limit

Citi (Closed Account) w/balance of $2K

NO BALANCES ON THE BELOW CARDS

Jared w/balance of $0 and $7.6K limit.

Capital One w/balance of $0 and $500 limit.

Shell w/balance of $0 and $200 limit

Gap w/balance of $0 and $200 limit

Express w/balance of $0 and $1,640 limit

[TrishN]

Depend on how long you have that credit card. How s your payments. Look like you make heavy used on all account and got max out credit card. 100% when max out total credit limit. They will not let you have CL increase. thats what I learned from this forum lol

[Asailorshort]

With so many cards maxed out, i'd say you'll likely have very little success with CLIs.  If you pay those balances down to less than 50% - or better yet 30%, your scores will improve greatly.  and you'll qualify for the business loan much easier and at a much better rate.  And you'll have much more success getting those CLIs.  Fyi, credit cars are considered maxed out when you're using 90% of their limits, so it looks like 8 out of those 10 cards are maxed out.  I dont know how much money you have available to throw at those cards, but they're  costing you big time.  You're probably paying around a thousand bucks a month in just interest on those cards.  Work out a plan to pay down those balanes first, before you even worry about getting CLIs or the business loan.  The best way to get credit is to prove that you dont need credit.

[aplast]

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Asailorshort wrote:  The best way to get credit is to prove that you dont need credit.

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Awesome way of putting it. OP I would say depending on how much liquid cash you have pay as much as you can on those cards and get your util down from being maxed out. It looks like you have some healthy cards and decent limits and they will grow when you have much smaller balances or NO balance. Good luck with your business expansion and getting those CLI's

[Dustink]

Once you pay all the accounts off. Wait a month after the zero balance statement before you try to do anything. You can leave one card with a balance of less than 9% of its limit, that seems to be ideal for scoring purposes, wait a month on that one after the statement as well.

After you have waited a month after the statements, your utilization will be updated on your credit reports and your score will likely jump over 700. You can go to credit karma and check your fako score. They have a score simulator that you can use to see how paying the cards off will effect your score.

Apply for cards that offer the best rewards for you, and pay them off in full each month. You can click on the links in my signature if you want to view them. I would recommend you check out the CSP, Cash+, Freedom, Marriott, Flexperks, and I can come up with more if you are interested. As for the CLI's, I don't really see that you have any good cards worth requesting increases on. You can try to get some CLI's with SP's, walmart might do it. Don't waste any hard pulls on the cards you have. They will start doing auto cli's once you pay them off. If you don't need them just close them after you get the new cards that you app for.

[Anonymous]

I really appreciate the advice everyone.  I think I just needed confirmation of what I suspected. My utilization rate is killing my score.  I should take the $20K that I have sitting in the bank and pay these balances off/down.  It is really hard to part with CASH when I think about potential emergencies.  However, I suppose I could use the credit cards in case of emergencies.

Dustin, thanks for the card suggestions.  I will be compiling a list if anyone else has suggestions about cards that I might qualify for in the future.

[codimom]

if you have the cash to pay off a good deal of these cards.. I would do it.  then start paying your 'credit card' payments back into your savings to build it up.  Unless you just like throwing money away I would rather earn interest than pay it.. so I'd pay off everything I could .  Lower util will help your scores as well.

Oh and I would not recommend using personal credit cards for business purposes... many companies frown on that ..

[Cadillac-XTS]

+1

[Dustink]

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@Anonymous wrote:

I really appreciate the advice everyone.  I think I just needed confirmation of what I suspected. My utilization rate is killing my score.  I should take the $20K that I have sitting in the bank and pay these balances off/down.  It is really hard to part with CASH when I think about potential emergencies.  However, I suppose I could use the credit cards in case of emergencies.

Dustin, thanks **bleep**

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You can do a cash secured loan to pay them off. That way the cash stays in your savings, but you don't get to use it until you pay off the debts. Just an idea. After you get the debts paid, you will likely get more credit extended to you. So, you will have credit 4 emergencies.

[Anonymous]

Dustin, I have considered that.  Thanks for the suggestion.