New Member
Posts: 3
Registered: ‎03-08-2007

Better to Pay Off Student Loans or Credit Cards???

I have a VISA with a balance 89% of its maximum credit line at 4.99% APR.
I also have a Student Loan with a small balance at 5.00% APR.

Would my FICO score improve more if I:

1) Paid off the Student Loan (about a $1,000).


2) Paid $1,000 on my VISA BILL (Bringing the balance to 75% of MAX).


Established Member
Posts: 84
Registered: ‎06-21-2007

Re: Better to Pay Off Student Loans or Credit Cards???

I think you ought to pay off the CC first. Having high util on revolving credit makes you look like you are not responsible with your money, living beyond your means, etc. etc. and therefore not a good credit risk because you are not likely to pay it back. Also that 4.99% could become much higher right before your eyes if you are late with one payment or when your introductory rate expires.
If the student loan is in repayment already, then just make your regularly scheduled payments and get that balance down on your CC.
Moderator Emeritus
Posts: 16,373
Registered: ‎03-12-2007

Re: Better to Pay Off Student Loans or Credit Cards???

[ Edited ]
First of all, congrats on a Visa with such a low APR. I agree with annah and you should pay down your revolving (credit card) debt as this effects your FICO scores considerably more than your student loan (installment) debt. FYI if you keep your total util% between 1-9 on your max credit line you will reap max FICO score points.

Message Edited by fused111 on 07-16-2007 08:59 PM
Credit Profile -
FICO 08 Scores (11-08-2014): EQ 818, EX 817, TU 822
All three scores were 850. Lost points for not having an open installment TL. So, BE WARNED!!!!!
Credit History: 26+ years ~ AAoA: 12 years ~ Util: 1% ~ Inqs: EX 1

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