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My four balances:
H.D. 8391 - 15000 limit 57% util
Cap 3957 - 4500 limit 88% util
HB - 816 - 935 limit 87% util
Sears 1798 - 3180 limit 56% util
Other 0 - 600 limit 0% util
Other 0 - 400 limit 0% util
total util approx 62%
I am looking for the best posible (statistical) method to pay 2000 toward these balances to result in the highest credit score increase. My cut date for these are approaching and I would like your opinions on how you would pay on these. If it matters I will likely pay another 2000 next month as well so keep that in mind while making suggestions. I do realize results vary by other things in credit etc. I have seen several threads similar to this but now that I want to see one I cannot find them.
Edit:
I may be able to squeeze out another 300 dollars that will allow me to bring both Cap and either HB or Sears below 50% util. Should that be my immediate play if I can swing it? Or get Cap below 80% and the HB and Sears below 30% All the cards have cut dates from 9-26 to 10-2 so like I saqid they are all approaching and will report my payments.
Thank You all for your input and opinions.
Of course, the best financial answer is to pay the one with the highest interest rate first, then the next highest rate, etc.
From a purely FICO perspective, or if the interes rates are the same, there are a few possible thoughts.
1) Get all cards below 90% - you're already there, but you're close on the Cap and HB cards. Keep them under 90% no matter what!
2) Get more than 50% of cards to zero. You can't do that with $2k, but you can get the Cap to zero, then throw the remaining money at the Sears. Next month, you can get that one to zero too, then move on to the Cap card.
3) Get all cards below 40% utilization. You can't do that with $2k either, but you can pay $500 on the HB and $900 on the Sears to get those under 40%, then throw the rest at the Cap to make sure it stays under 90%.
I'd go with option two personally. It zeros out one card this month, plus gets a second one under 40%. Next month, it'll get you 50% of cards reporting zero, and then you can chip away at the Cap card, and eventually move on to the HD card.
Sorry, I forgot to mention I hav etwo cards that are paid off. I have edited the original list to include them. Thank You
I would zero the HB, for 50% of cards reporting zero. Get Sears under 40%, then throw the remainder towards Cap, which will get it under 80%. I can't say for certain, but that would be my best guess to maximize FICO.
I don't think your really going to see any major score jump until you really get them all down to under the 40% mark. And even then your not going to see as big a jump as if they were all reporting 0 except for 1 reporting less than 9%.
Can I ask why your looking for the biggest jump in score? I think you should be more focused on making the 2k be streteched the furthest each month rather than just blowing it mostly on interest just trying to get some points on your fico score.
If your looking for a big ticket item in the next few months (car or mortgage) they are going to see that high Util and its a red flag either way so in the end you'll still need to get them down under the 9%. How you get there won't really matter as far as fico score, but it could end up costing you more money by paying off smaller interest rates with lower balances than paying off higher balance/rate cards...
Something to think about.