Pay credit card debt or unsecured loan first?

BarbaraBeau · ‎03-27-2008

This is my first posting to this board. I have a large lump sum of money to pay off my debt. Although I know I should pay off the higher percentages first, if I have to choose between paying off a credit card vs. paying off an unsecured loan for the same percentages and total debt, which would help my credit score more?

I'm thinking I should pay off the credit cards first since it will improve my debt to credit ratio? Any advice?

Anonymous · ‎03-27-2008

CC count more toward scores! after you pay them off take what you would be paying & add it to your payment toward other debt.

Anonymous · ‎03-27-2008

It would help your scores more to pay down CC balances first. Your FICO scores are affected greatly by utilization on revolving debts. ( Ideal utiliz is 1-9% of available credit on revolving ) Don't let the cards stay dormant, show small usage every couple of months. Is other unsecured debt Installment? If so installment balances don't affect you as much as long as reorted as current.

BarbaraBeau · ‎03-27-2008

Thanks so much for the advice! That's what I'm going to do.

Anonymous · ‎03-27-2008

I am so glad I found this site because every question I ask or need to know is already here. Thank you for asking that question because I was going to post it. I was unsure if I should pay down CC or CA accounts that's closed out. I need my scores to move and if I pay down my CC I believe it will. My credit cards are maxed and I need to bring them down.