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Established Member
cagle1
Posts: 22
Registered: ‎07-28-2008
0

Paying off credit cards

I have a question about my credit cards and trying to pay them off. I have a total of 6 cards and 3 of them have balances. The balances total about $10,000 and I have a total credit limit of about $13,500. Should I just try to bust my hump in getting them paid off as quickly as possible, or should I try to get a personal loan? I know on here it is said the best way to get your credit score as high as possible is mainly due to utilization. My credit score roughly now is about 660. Any help is greatly appreciated!:smileyhappy:

 

Thanks!

Regular Contributor
Cyan007
Posts: 237
Registered: ‎08-02-2009
0

Re: Paying off credit cards

I don't think applying for a loan to pay off your credit cards is a good idea.  I think the standard is to just bust your hump, reduce spending in general, and pay the highest APR card off first.  It may take a year (or longer) but it'll feel good in the end.


EQ (11/16/2007): 573

Starting Score (1/1/2010): EQ: 712 -- TU: 726
Current Score: EQ: 748 (12/22/11) -- TU: 726 (1/7/10) -- TU04: 701 (1/27/10) -- EX: 747 (1/27/10) (LO)
Goal Score: EQ: 760


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Moderator
MarineVietVet
Posts: 14,946
Registered: ‎07-14-2009
0

Re: Paying off credit cards


cagle1 wrote:

I have a question about my credit cards and trying to pay them off. I have a total of 6 cards and 3 of them have balances. The balances total about $10,000 and I have a total credit limit of about $13,500. Should I just try to bust my hump in getting them paid off as quickly as possible, or should I try to get a personal loan? I know on here it is said the best way to get your credit score as high as possible is mainly due to utilization. My credit score roughly now is about 660. Any help is greatly appreciated!:smileyhappy:

 

Thanks!


If you don't mind posting the exact amounts, i.e exact balance, credit limit and interest rates on each card you will get better advice. You have an overall utilization of 74% ($10,000/$13,500). That is pretty high. FICO also takes into account the individual util on your cards. That's why it would be helpful to post the info on each card. 

 

I would suggest that you stop using the cards until you have them paid off. If you find yourself in a hole the first thing you need to do is stop digging.  :smileyhappy:

 

I think another loan is not needed depending on what the details of your situation are. You can get tons of helpful advice here. Welcome to the forums.

 

 

(myfico)
7/09         8/09
TU-742
EQ-779    783

 

CC interest free as of 8/09
Time can heal all wounds and a low FICO.
"Hello my name is Sandy and I'm a recovering crediholic".

Established Member
cagle1
Posts: 22
Registered: ‎07-28-2008
0

Re: Paying off credit cards

No, I don't mind posting that at all...the more help the better! :smileyhappy:

 

Household CC- balance $1061 - limit of $1300 - Rate of 13%

SST CC (I really want this one gone!) - balance $2200 - limit of $3000 - Rate 22%!!!!!!!

NFCU - balance $7200 - limit of $8700 - Rate $12.9%

Capital One - balance $0 - limit of $500 - Rate - 12%

Capital One - balance $0 - limit of  $1000 - Rate 12%

Lowes - balance $0 - limit $500 -  Rate 12%

 

I just really want to get my scores as high as possible. I have come a long way from low 500's (about 4 years ago), to mid 600's.

 

Thanks!

Moderator Emerita
Community Leader
Epic Contributor
haulingthescoreup
Posts: 28,098
Registered: ‎04-01-2007
0

Re: Paying off credit cards

Two different ways of doing it. You've indicated that you want the highest APR card paid off first, which absolutely makes the most financial sense.

Others have found that the snowball approach works best: pay off the smallest balance while making minimums on the others. When that card is paid off, take the amount that you were paying, add it to the minimum on the next smallest balance, pay it off. Lather, rinse, repeat. This approach might have you paying more interest over time, but it helps a lot of people get past that initial sense of hopelessness. If you were going to do this, you would pay off the Household card first.

Some people with balances on lots of cards snowball the first two or three to build up some momentum, and then they switch to highest APR, then next-highest, and so forth.

But as you've indicated that your bug-a-boo is the high APR card, then absolutely, go for it first.

I think you're safe letting the Navy card ride for a while, as long as you never ever come anywhere close to missing a payment. There might be some feedback from Navy cardholders about their willingness to let you carry a balance for a while.

In the meantime, get the cards out of your wallet, cut expenses, dig up some extra income if at all possible (McDonalds breakfast shift on the weekends! Free yummy food!), and concentrate on throwing everything you can at your debt. Good luck!
* Credit is a wonderful servant, but a terrible master. * Who's the boss --you or your credit?
FICO's: EQ 781 - TU 793 - EX 779 (from PSECU) - Done credit hunting; having fun with credit gardening. - EQ 590 on 5/14/2007
Established Member
cagle1
Posts: 22
Registered: ‎07-28-2008
0

Re: Paying off credit cards

Thank you so much for your help...I kind of figured that would be the best way to go. I just recently got married and his scores are high 700's. I really want to get to a higher score sooner than later. I will really buckle down and try to pay off as much as possible. By the way, I do have one medical collection from early 2006 that was paid in full to the original creditor in late 2006. I do remember seeing somewhere in here where there are good will letters to get it removed? Do any of you know where I can find this?

 

Thanks!

Moderator Emerita
Community Leader
Epic Contributor
haulingthescoreup
Posts: 28,098
Registered: ‎04-01-2007
0

Re: Paying off credit cards

Congratulations on your marriage, and best wishes!

Check the Frequently Requested Threads for examples of GW's. It's linked in my siggy below, and it's stickied at the top of several of the boards.

You might want to search on Rebuilding Your Credit for threads discussing your chances with your particular collection agency. Some are more willing to help out than others.
* Credit is a wonderful servant, but a terrible master. * Who's the boss --you or your credit?
FICO's: EQ 781 - TU 793 - EX 779 (from PSECU) - Done credit hunting; having fun with credit gardening. - EQ 590 on 5/14/2007
Established Member
cagle1
Posts: 22
Registered: ‎07-28-2008
0

Re: Paying off credit cards

Thank you on the best wishes...So far so good! I do have on other question about the credit cards I have paid off. Would it put a jump in my score if I put a little balance here and there on the zero balance cards? I hear differently sometimes. I have heard to get it to a zero balance and leave it alone, and I also heard to charge to the cards and payoff promptly? I am just trying to get as much as I can:smileyvery-happy:

 

Thanks!

Senior Contributor
creditwherecreditisdue
Posts: 4,923
Registered: ‎04-19-2009
0

Re: Paying off credit cards

As long as you have one revolving account that reports a balance you are good for FICO purposes.

 

On the other hand you should use each of your CC's at least once a quarter. CC's can be closed by the issuer for disuse, occasionally without notice to you. You do not want that to happen! Nothing's worse than hauling out that CC you had squirreled away for an emergency and have it declined due to an account closure!

New Contributor
thoughts1
Posts: 110
Registered: ‎01-12-2009
0

Re: Paying off credit cards

whenever there's high APR on cards first look for other ways to lower it, either by a new 0% card, etc.

since util is so high one in your name would probably be difficult to get, but think outside the box for a second, what about a family member with good credit?  imo that'd be the best way to go.

others may disagree and of course it all depends on your relationship with them etc.

but paying 0% on your balances(even lets say 3% for a BT fee) instead of 12% will help you out a ton.


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