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Paying down CC ?

Established Member

Paying down CC ?

Hi all, this board is great! Quick question: I have 2 credit cards:
 
CC1: $2800 balance--$3000 limit
CC2: $2000 balance--$2100 limit
 
I have $2500 in cash to pay on 1 or both. Should I pay off the CC2 or spread it even between both CC1 and CC2? Would either way make a difference on the FICO scoring?
 
Thanks!
9 REPLIES
Established Contributor

Re: Paying down CC ?

Hi Newark,
 
There will be no Fico difference as your utilization will be lower either way so it doesn't matter. I would pay down the card with the higher APR first.

Valued Contributor

Re: Paying down CC ?



Uncle_Money wrote:
Hi Newark,
 
There will be no Fico difference as your utilization will be lower either way so it doesn't matter. I would pay down the card with the higher APR first.


 
I agree.


Starting Score 3-31-08: EQ 582 TU 577 EX 625
Current Score 3-19-10: EQ 703 TU 712 EX No Clue
Goal Score: 800 By January Of 2012


Take the FICO Fitness Challenge
Established Member

Re: Paying down CC ?

Thanks for the advice...
Valued Contributor

Re: Paying down CC ?

I would worry a little more about your credit standing with your issuers and a little less about FICO. Issuers DO NOT like maxed out cards. Once you get both cards out of maxed status you can worry about which has the higher APR. For now divide up the money so you get both balances down.
Established Contributor

Re: Paying down CC ?



jmbfl wrote:
I would worry a little more about your credit standing with your issuers and a little less about FICO. Issuers DO NOT like maxed out cards. Once you get both cards out of maxed status you can worry about which has the higher APR. For now divide up the money so you get both balances down.





I personally never had problems with issuers when my CCs were maxed out, and I know it happened a lot to me before I started trying to pay them off.

I also would pay down on the card with the highest APR.
4/16/09: TU: 775, EQ: 805
2/11/09: TU: 773, EQ: 790, EX:790
11/16/08: TU: 773, EQ: 785, EX: 780
Goals for 2009: 0 Credit Card Debt & 0% Util (achieved 2/6/09), Mortgage! (achieved 11/2/09), getting closer to 800 scores (I crossed this earlier this year, but I'm sure I'm not there anymore!)
Valued Contributor

Re: Paying down CC ?

What is the Interest rate on the cards?  It goes without saying I would pay the higher first.
CURRENT SCORES: TU: 641 21 Apps / EX: 644 28 Apps / AAoA: 4.4 Yrs. / Util. 28% / Goal: 700 by 7/2/15

Super Contributor

Re: Paying down CC ?

If your goal is to get out debt (which it should), make minimum payment on CC#1 then put all the rest on CC#2.  Once CC#2 is paid off, then attack CC#1.  Dont worry about interest rates or FICO scores in that they will take card of themselves.
 
You could also follow jmbfl's plan which is both CCC friendly and FICO friendly.


Message Edited by marty56 on 08-03-2008 08:44 AM
10/17/2017 FICO: EQ 829 TU 830 EX 826
Established Contributor

Re: Paying down CC ?



marty56 wrote:
If your goal is to get out debt (which it should), make minimum payment on CC#1 then put all the rest on CC#2. Once CC#2 is paid off, then attack CC#1. Dont worry about interest rates or FICO scores in that they will take card of themselves.
You could also follow jmbfl's plan which is both CCC friendly and FICO friendly.


Message Edited by marty56 on 08-03-2008 08:44 AM




Except if you're trying to get out of debt you should worry about APR's. If the OP's APR on card 1 is 30% and card 2 is 10% it is going to take the OP longer to get out of debt if card 1 still has a balance with a higher interest rate, plus that's more money down the drain through interest.
4/16/09: TU: 775, EQ: 805
2/11/09: TU: 773, EQ: 790, EX:790
11/16/08: TU: 773, EQ: 785, EX: 780
Goals for 2009: 0 Credit Card Debt & 0% Util (achieved 2/6/09), Mortgage! (achieved 11/2/09), getting closer to 800 scores (I crossed this earlier this year, but I'm sure I'm not there anymore!)
Super Contributor

Re: Paying down CC ?

Dave Ramsey and others recommend paying the smallest balance off first.  This provides momentum and motivation to people who for the most part need it to help stick with the plan.
10/17/2017 FICO: EQ 829 TU 830 EX 826