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Using tax refund to pay cc balances

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ycm
Established Member

Using tax refund to pay cc balances

Anyone else planning on doing this? My refund is going to help put a 25% dent in my cc utilization. I like to think my gardening process will appreciate the lift. Smiley Happy

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Message 1 of 33
32 REPLIES 32
ninjamike81
Regular Contributor

Re: Using tax refund to pay cc balances

I am using my refund to pay a $600 balance on my citi card taking my over all util. from 10% to 0% than only letting walmart report b/c I cant get no love from them.  but the rest of the 6k left is paying off ALL my wifes baddies. Time for us both to be in the 700's

 

edit:  also buying credit reports for both once all the balances go down and baddies off.  here on my fico.  any body know if it is frouwned apon to just apply for a morgage just for the tripple pull.  my inq are through the roof anyway but can explain to underwriter if it comes up in a review


Starting Score: TU 583, EX 683, EQ 653
Current Score: 10/12/14 TU 743 9/24/2014 EQ FICO 751,12/17/2014 EXPERIAN 772
Goal Score: 750

WALLET: CAP ONE UNSEC $2000, WALMART $3800, CITI SIMPLICITY $3600, DISCOVER IT $2000, BBRZ $2200, AMEX BCE $24,500, CHASE FREEDOM 10,500 KAWASAKI GOOD TIMES CARD $31,500
Message 2 of 33
drkaje
Senior Contributor

Re: Using tax refund to pay cc balances

Definitely!


Starting Score: 675
Current Score: EX 753 FICO, EQ 737FICO, TU 738
Goal Score: 776 FICO


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Message 3 of 33
Epcot
Valued Contributor

Re: Using tax refund to pay cc balances

Any money I get back will definitely go to paying CC balances. Maybe a small bit to augment our savings.

Starting Score: EQ 717 EX 724 TU 736
Current Score: EQ 849 EX 835 TU 841
Message 4 of 33
BearsAndTurtlesRtheBest
Senior Contributor

Re: Using tax refund to pay cc balances

LMBO! yes my family is doing this aswell!! it defintely helps lower your worries and boost your scores Smiley Happy

 

Discover IT $2,600- First Premier MasterCard $1,000- Dillards Store Card $300- Fingerhut Advantage $200
Chapter 7 BK Dischagred on 07/11/16. Gardening Since 01/17/2019
Message 5 of 33
SnackTrader
Valued Contributor

Re: Using tax refund to pay cc balances


@ninjamike81 wrote:

I am using my refund to pay a $600 balance on my citi card taking my over all util. from 10% to 0% than only letting walmart report b/c I cant get no love from them.  but the rest of the 6k left is paying off ALL my wifes baddies. Time for us both to be in the 700's

 

edit:  also buying credit reports for both once all the balances go down and baddies off.  here on my fico.  any body know if it is frouwned apon to just apply for a morgage just for the tripple pull.  my inq are through the roof anyway but can explain to underwriter if it comes up in a review


If you need to see your reports why don't you just go to annualcreditreport.com?

 

Or are you just looking to get your scores?


In My Wallet: Amex BCP (12/12) $50,000, Chase Freedom (12/12) $16,500, Cap1 Quicksilver (6/12) $14,000, Barclaycard Rewards (5/13) $10,500, Citi Prestige (4/16) $30,000

Last App: June 27, 2015
Message 6 of 33
creditnocash
Valued Contributor

Re: Using tax refund to pay cc balances

turbo tax projected so far i will be getting 1400 but thats only half my income reported. will be getting my 2nd w2 tommorrow morning. 

hopefully it doubles, and ill be able to pay off everything including my 0% finance deals. and ill let only one card report like the usual. 

 



Current: Fico ScoresEQ~706 TU~719 EX 709 4/28/23

Inquiries (24 Months): EQ 0 TU 0 EX 0| Most Recent: A LONG WHILE
Over 12 Months:0


2023 Goals:
Buy A Home
Earn Cash Back

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Citi DC $10,000
Citizens Mastercard$7,000

Message 7 of 33
afbar1114
Valued Contributor

Re: Using tax refund to pay cc balances

I am planing only using about $750-$1k to pay down some CC and the rest ill keep in savings and checking as i want to pay down everything my self. 

AMEX PRG; AMEX EveryDay $14,800; Freedom $6k; Sapphire $7k; IHG Select $5k; Discover $2,400; BofA Better Balance $9,100; Bank Americard $5,900; Citi DC $2,700; Citi Diamond $2,500; BestBuy $20,000; Amazon Prime $5k, United Club $15,000; Home Depot $20,000; Barclays $7,500

Total Credit Limits: $122,650
Message 8 of 33
Roarmeister
Frequent Contributor

Re: Using tax refund to pay cc balances

No.  My refund is going to my mortgage principle payment.  I figure I can PIF the rest of my credit in about 5 months so that will take care of itself.  Still, its worth checking out to see what the fiscal advantage might be to pay the cards off sooner so out comes the calculator and spreadsheet. 

 

I estimated my refund to be in the $1500 range the other day so if I decided to pay off the cc first it would only save me roughly $300 in interest.  If I pay it towards the principal of the mortgage, I cut out $1260 in interest.

 

I have one card with a balance with an interest rate of 5.99% and a mortgage of 3.6%  If in 2 years, the mortgage rates could rise to 7% or higher if inflation runs amok.  My premise is that I will be glad I paid more of the principal earlier when I could afford to. Besides I want to retire mortgage free.  Smiley Happy

 

Recalculated using time-value of money and it turns out that a bird in hand really is worth 2 in the bush.  In other words due to immediacy and value of the money in today' worth, it actually makes more sense to pay off the debt first before applying to the mortgage despite the fairly narrow interest rate difference. So I am changing my mind and paying off the cc instead.

Starting Score: EQ 732 October 2007; Current Score: EQ 839; TU 865, July 2022;
Oldest Reporting EQ Account: 20.4 years; EQ AAoA: 9.9 years;
ACTUAL Oldest account 40.1 years; ACTUAL AAoA 19.3 years.





Message 9 of 33
eviLution
Established Contributor

Re: Using tax refund to pay cc balances

I'm not in debt so it goes straight to my bank. I ain't getting much back though lol

DCU Platinum: 4000 - Discover IT: 11000 - Walmart: 5000 - AMEX BCP: 18000 - Chase Freedom VS: 5000
in the garden since 1/24/14 - #GARDENSTRONG
Message 10 of 33
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