Should I pay OFF or pay down??

[ttonnka3]

Hello,

Should I pay off all my credit cards or pay down? all have a high balance

what would be better for my credit/score?

thanks

[guiness56]

Never let all of your CC report a balance or a 0 balance.  FICO doesn't like either.

For optimal scoring, have all but one report 0 balances and the last one at 9% or below.

Each card is scored individually and if are maxed out you will be dinged for that along with high utilization. If any are at or near maxed out (90%) get them down to at least 70%.  Then the faster you pay off one and get it reporting a 0 balance the better, then the next ect.

[janrobertson]

Tackle the highest interest rate cards first, as those are costing you the most money.  Get those down to a managable balance and then start on the cards with the lower rates.  Don't have all of them with 0 balances, as the pevious post said, but get them down and try to keep them down so you're not paying out the nose in monthly interest.  

[Fico2Go]

Guiness,  why pay off all but one with a small balance? 

Is there a reason why this strategy would be superior to keeping all cards under 10%? 

[myjourney]

When wanting to raise scores Fico algorithm likes to see 

One card report a balance between 1-9% 

All others paid to $0

Of course everyone's sweet spot can be different places but still between 1-9%

Mine use to be 1-3% for best results 

[guiness56]

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@Fico2Go wrote:

Guiness,  why pay off all but one with a small balance? 

Is there a reason why this strategy would be superior to keeping all cards under 10%? 

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Not only what myjourney stated but, FICO does not like all cards reporting 0 balances nor all reporting a balance.

[Fico2Go]

Great.  It's just one of those FICO thing I guess.   

If that's how the game is played then we need to play it. 

[guiness56]

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@Fico2Go wrote:

Great.  It's just one of those FICO thing I guess.   

If that's how the game is played then we need to play it. 

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Well, look at it like this.  Too many report a balance and it looks like you rely too heavily on credit.  None report a balance and you aren't using the credit extended to you.

[Fico2Go]

Guiness, but I'm hearing that none reporting is also not good???  

What I don't understand is how none but one reporting is best.    

[guiness56]

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@Fico2Go wrote:

Guiness, but I'm hearing that none reporting is also not good???  

What I don't understand is how none but one reporting is best.    

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Look at what I wrote again.  None reporting makes it look as though you don't use the credit given to you.

Read this and see if it helps you understand better http://www.myfico.com/crediteducation/whatsinyourscore.aspx