Using NFCU CLOC

[ryder32244]

Im still uncertain how to leverage the NFCU CLOC, but I have an idea of how it can help me if it works like I think it does. 

My wife was recently approved for a 3000 CLOC. We are both rebuilding our credit and have a few sub prime cards w/monthly and/or monthly fees with a total balance of about $1700 across 5 cards with about 40% utilization. We are leveraging each other as authorized users where it makes sense. Cards are as follows:

Total Visa - 0/300

First Premier 0/750

First Premier 0/500

Amazon Store 300/600 - Thought I needed to actually by the large item I put in my cart, paying that off at 75 per month

Cap 1 Secured 300/500 - Paying off at 100 per month

Chase Fred unlimited 1400/2000 - Paying off at 400 per month

Cap One Quick Silver  250/600 - Paying 50 per month

Citi Secured 175/500 - Paying 50 per month

Credit One 0/1000

Credit One 0/700

USAA Secured - */800 - Everyday items pay in full every month, 350 per month

NFCU go - 1600/2700 - Paying 400 per month

NFCU go - 1000/1400 - paying 300 per month

NFCU CLOC - 0/3000

The question is, does it make sense to transfer some of these balances to our CLOC and use that? The interest rate is lower than any of my cards. Or am I thinking of the CLOC in the wrong way. 

Any thoughts appreciated. 

[Anonymous]

Most here are using their CLOC primarily as padding for utilization. Meaning, they go for the full $15K limit and rarely use it. Since that $15K is available, they feel more comfortable using their other cards and letting balances report on those for a good debt-to-credit ratio.

You could certainly use the CLOC to consolidate bills if the interest rate is lower. The benefit of having a Line Of Credit (LOC) is that it can be used for nearly anything. A 0% balance transfer card would be the best option for what you are trying to accomplish; however. 

[SouthJamaica]

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@ryder32244 wrote:

Im still uncertain how to leverage the NFCU CLOC, but I have an idea of how it can help me if it works like I think it does. 

My wife was recently approved for a 3000 CLOC. We are both rebuilding our credit and have a few sub prime cards w/monthly and/or monthly fees with a total balance of about $1700 across 5 cards with about 40% utilization. We are leveraging each other as authorized users where it makes sense. Cards are as follows:

Total Visa - 0/300

First Premier 0/750

First Premier 0/500

Amazon Store 300/600 - Thought I needed to actually by the large item I put in my cart, paying that off at 75 per month

Cap 1 Secured 300/500 - Paying off at 100 per month

Chase Fred unlimited 1400/2000 - Paying off at 400 per month

Cap One Quick Silver  250/600 - Paying 50 per month

Citi Secured 175/500 - Paying 50 per month

Credit One 0/1000

Credit One 0/700

USAA Secured - */800 - Everyday items pay in full every month, 350 per month

NFCU go - 1600/2700 - Paying 400 per month

NFCU go - 1000/1400 - paying 300 per month

NFCU CLOC - 0/3000

The question is, does it make sense to transfer some of these balances to our CLOC and use that? The interest rate is lower than any of my cards. Or am I thinking of the CLOC in the wrong way. 

Any thoughts appreciated. 

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If you're paying interest on a credit card, and the interest rate is higher than the rate on the NFCU CLOC, then sure it makes sense to pay off the credit card balance.

But I wouldn't use more than 29% of the CLOC, because going over that would cause some downward pressure on your FICO 8 score.

[ryder32244]

Thats what I was thinking, I just wasnt sure if there was something I was missing in regards to how the CLOC works. 

[ryder32244]

I wish I could get a 0% balance transfer card. Still rebuilding and just understanding what I have done. If I had read the NFCU boards earlier, I wouldnt have ran them up so high and waited until the 3 statements cut and hopefully get the large cli. I charged it right out the gate on some medical bills, so I think the large increase at the end of my 90 days is gone. 

[Anonymous]

The interest rate for my cloc is much lower than ALL of my cards. I plan on using it to pay off all but one card and pay that down by the end of the year. I figure that there shouldn't be too much damage to my fico score and even if there is, so what as long as my cards are consolidated and being paid off efficiently.

From what I understand, I can transfer the money to a linked account or just write a check to myself and then pay off my cards as I usually would. I'm not too keen on overdrafting my Navy checking account to access the funds. I think a negative balance will always look terrible even if you have the LOC padding to back it up.

[jdxprs1]

Is there a way to use the cloc besides ordering checks for it? For example, can I do a transfer from cloc into checking?

[woodyman100]

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@jdxprs1 wrote:
Is there a way to use the cloc besides ordering checks for it? For example, can I do a transfer from cloc into checking?

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The CLOC is by definition, a Checking line of credit.

If you overdraft your checking it will draw on the CLOC.

I believe if you want to transfer money without overdrafting, then you would need to write a check to yourself through another institution.

If i'm wrong, i'm sure I will be corrected here shortly

[Anonymous]

Hi everyone, if you want to use CLOC there is a way to get the funds instantly online! Follow the steps below!

1. Transfer all money in your checking account to savings.

2. Go to transfer menu again and select transfer from checking to savings. 

3. Input how much you want to advance from the CLOC in the amount section.

4. The system will process and automatically take the money from CLOC since you are esentially overdrafting your checking account to transfer the funds into your savings. Woolah done! No fees will be charged except for the interest on the CLOC and you have your money way sooner and easier. Cheers and happy 4th!

[jdxprs1]

Cool! Thanks