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Contributor
Learning_Tee0225
Posts: 87
Registered: ‎04-08-2012
0

best way to pay down cards

Okay.. so i did a dumb thing and app'd for two cards i really wanted  KNOWING I SHOULD HAVE WAITED..and got the same response on Recon w/ BOTH! Discovert IT and CHASE FREEDOM

 

" Your Balances are a little to high on your existing cards pay them down, re apply"

 

I KNEW THAT! But i was bored..and wanted to get into Prime card territory!

 

NOW annoyed that it was the one thing stopping me im going to pay them all off in the next 30 days excluding one 3k CL ill have to chip away at. The CL are as follows

500 LC

400CL

300CL

300CL 

 

Not huge limits but im wondering if there is a science to paying them down. Should I just Zero them all out? or leave small balances on each like 7$..6.33$..

Im completley confused on what FICO likes..lol wanting to please it iIpaid off a card before it hit my report  thinking zero was better yet no change to score..the next month let it report an 80$ balance and my score shot up 22 points..oh FICO GODS what do you want from us!!??


Mortgage ready by 12-31-2013

EQ- 625 June-2013 TU 636 // May-2013 EX 633 May- 2012
Orchard 300$CL
Navy Fed SEC 500$ CL
Navy Fed Cashrewards 3K CL
NFCU GoRewards 1K


Regular Contributor
unusuallyconfused
Posts: 232
Registered: ‎03-05-2013
0

Re: best way to pay down cards

[ Edited ]

People are going to tell you that if you're carrying balances on your cards and you can't quite afford to pay it all off at once, they pay the balances in order of highest interest rate to the lowest.

 

So take all your extra money and hit the highest interest rate card you have with the minimum payment plus tons extra on top of that. Pay, pay, pay until you've got a zero balance. While you're working on that, pay the mimimums (at least) on the other cards to keep them current (but it's advisable, if you can afford it, to pay above mimimums on those, too),

 

That's from the financial side (saving money by bringning down your high interest cards first). The other side is paying off your lower balance cards as quickly as possible and then attacking the highest balance card. By doing that you end up getting all of your cards down to zero balances faster while chipping away at the card with the largest balance.

 

Any event, people will tell you high interest cards first pay while at the same time above mimimums that you can afford on the rest and then zero them all out but leave ONE card with a small balance (no more than 3-9% - this demonstrates "recent use" of a credit card and shows responsible use).

 

 

USAA Rewards VISA (7,500 - 03/2013) / DiscoverIT (6500 - 03/2013) / Cap One Platinum MC (2750 - 03/2013) / Credit One Platinum VISA (750 - 03/2013) / First Premier Bank MC (300 - 02/2013) / FingerHut/WEBBANK (5200.00 - 02/2013) / Victoria's Secret/Comenity (1500 - 03/2013) / PayPal Smart Connect/GECRB (2900 - 03/2013) / Lowe's/GECRB (2800 - 03/2013) / Amazon.com/GECRB (4500 - 03/2013) / Chevron Texaco/GECRB (1950 - 03/2013) / J.C. Penney/GECRB (2150 - 02/2013) / Target (750 - 07/2013) / Abercrombie & Fitch/Comenity (1850 - 07/2013) / CareCredit/GECRB (4500 - 08/2013) / DCU Visa (2000 - 11/2013) / NFCU Sig cashRewards Visa (7000 - 11/2013) - MilitaryStar/Chase (4700 /12/2013)

Regular Contributor
silverzgirl
Posts: 165
Registered: ‎05-07-2013
0

Re: best way to pay down cards

If I am reading correctly, you have the dinero to zero out all but one, which you will chip away at.

 

This is a good approach. In addition to too much utilization, I got hit with "too many cards with balances." I am paying all but a couple of bank cards off, then throwing money at the highest interest rate on down.

 

Zero all but your chip away card.

Starting FICO, June 2010: EX-581, EQ-581, TU-581
Now: EX-742(Quizzle) EQ-656 (MyFICO), TU-720 (Bank)

Currently: BECU Visa 12K, Navchek 15K, NFCU Platinum Visa 11K, AMEX Delta SkyMiles 9K, Vystar CU Platinum Visa 7500, Military Star 8200, Nordstrom 6000, Talbots 3000, Ann Taylor 2280, Apple/Barclay 2000, Pier 1 1500, Macys 1300, Victorias Secret 750, NY&CO 500, J.Crew 300



Valued Contributor
takeshi74
Posts: 2,849
Registered: ‎06-05-2013
0

Re: best way to pay down cards

[ Edited ]

Learning_Tee0225 wrote:

 

Not huge limits but im wondering if there is a science to paying them down. Should I just Zero them all out? or leave small balances on each like 7$..6.33$..


How you pay them down is partially subjective.  To minimize interest pay higher interest cards first.  To give yourself a better sense of accomplishment pay down the small balances first.  In the end you want them all zeroed except for one with a small balance leaving you with <10% overall utilization for maximum scoring (standard recommendation around here).

 

 


Learning_Tee0225 wrote:

 

I KNEW THAT! But i was bored..and wanted to get into Prime card territory!

 


You'll be in much better shape in prime card territory if you get your utilization as low as posible (and reported) before applying.

Contributor
Learning_Tee0225
Posts: 87
Registered: ‎04-08-2012
0

Re: best way to pay down cards

 


silverzgirl wrote:

If I am reading correctly, you have the dinero to zero out all but one, which you will chip away at.

 

This is a good approach. In addition to too much utilization, I got hit with "too many cards with balances." I am paying all but a couple of bank cards off, then throwing money at the highest interest rate on down.

 

Zero all but your chip away card.


Yes Exactly..okay thank you all for your responses will just zero out then pay down the last card over the next couple months.


Mortgage ready by 12-31-2013

EQ- 625 June-2013 TU 636 // May-2013 EX 633 May- 2012
Orchard 300$CL
Navy Fed SEC 500$ CL
Navy Fed Cashrewards 3K CL
NFCU GoRewards 1K



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