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Need some advice about paying down debt

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designated_knitter
Established Contributor

Need some advice about paying down debt

This fall I moved which resulted in me maxing out most of my credit cards.  Several are over limit by a few hundred bucks... Several are over limit by a few bucks.

 

I'm supposed to get a bonus of several thousand dollars at the end of February.  

 

I *WAS* going to use that bonus to pay off some personal debts and used anything left over to bring others down to 50-80 percent.

 

Today, I got a nasty surprise from Macy's:  I had (operative word HAD) a 5400 CL.  After going 30 days past due with a DIFFERNT creditor back in October (haven't missed a payment to Macys), and tanking my credit score even more than the Utilization was, they lowered my credit limit from 5400 to 3500.  However, I still owe around 5000 on Macy's which will mean I'll be over 1500 dollars over my credit limit.

 

Would I be better off using the bonus to pay down Macy's to make it more in line with my new credit limit OR proceed with the plan to get the rest of the cards down to 50-80 percent?

 

In essence -- if I have 10 credit cards, is it better to have nearly all cards paid down with 1 card WAAAAAY over the credit limit 

 

OR

 

have 10 cards that are around 90 percent utilized (but Macys is not WAAAAY over the credit limit)

 

I guess the question is does FICO scoring care HOW much you are over your limit (being over your limit is like being pregnant -- you can't be just a little pregnant)

 

Hope that makes sense.  

 

Thanks in advance for any advice and/or words of wisdom.

 

 

Started Over Again after Cap1 Death Penalty:
06/15/2019:
03/02/2021:
04/06/2021:
05/28/2021:
Lesson Learned: DON'T POKE THE BEAR!!! THE BEAR WILL WIN!!!
Message 1 of 3
2 REPLIES 2
whatever4ever
Established Member

Re: Need some advice about paying down debt

Get the overlimit card under limit.  It'll look terrible, and might result in the same thing happening to the others.  It'll be a huge elephant in the room you'll have to deal with eventually anyways.

Message 2 of 3
designated_knitter
Established Contributor

Re: Need some advice about paying down debt

Here's more specific information:

 

I've got

 

  • Cap1 card 1:  CL = 1800, balance = 2100
  • Cap1 card 2:  CL = 1650, balance = 1950
  • Cap1 card 3:  CL = 1650, balance = 1600
  • Sony Cap1 Card:  CL = 2000, balance = 1950
  • CU MC: CL = 500, balance = 500
  • Jared with CLI of 1500 (though reports as 2000) with balance of about 1400
  • Care Credit -- 1200 CL with balance of about 1200
  • Firestone -- 1200 CL with balance of about 1200
  • Walmart -- 400 CL with balance of about 400
  • Sams -- 500 CL with balance of about 500
  • Overstock with 800 CL with balance of about 800
  • HSN with 850 CL with balance of about 800
  • Several Comenity toy limit cards that aren't maxed out.
  • Macys:  CL = 3500 (now), balance = 5000

So I was planning on getting all the Cap1 cards down to under CL with reasonable utilization, paying off toy limit cards, and paying off Jared.

 

Started Over Again after Cap1 Death Penalty:
06/15/2019:
03/02/2021:
04/06/2021:
05/28/2021:
Lesson Learned: DON'T POKE THE BEAR!!! THE BEAR WILL WIN!!!
Message 3 of 3
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