Understanding FICO® Scoring

[ktl72455]

Hello everyone! I have a question and looking for some input.

CC #1 balance of 8,300 Sams club Discover

CC# 2 balance 7,000 AARP Chase

CC#3 balance of 6500 Discover

All 3 close to maxed out. I have 2000.00 extra to apply. Do I apply it all to one or divide it up by 3 to lower all 3 balances?

[Brandnick]

Utilization is calculated amongst all your credit cards so if you shared the $2000 on all the cards vs. Paying just one card your utilization will be the same.

E.g. 

- Sam - $8300 with $8500 limit

- AARP Chase - $7000 with $7500 limit

- Discover $6500 with $7000 limit

How utilization is calculated

$8300 + $7000 + $6500  = $ 21800 balance 

$8500 + $7500  $7000 = $  23000 Limit

Calculation

Total Balance divided by Total Limit =  Utilization

$21800 / $23000 = .974 ( x 100) = 94.7% Utilization

My suggestion would be is to pay this extra $2000 on the credit that has the highest Apr 

[ktl72455]

This helps alot! Thanks for the information!

Now my next question is I have a CO on a CC from 2yrs ago and its still showing a balance of 1300.00.  Since that is a CC is that balance factored in to my Utilization or just a baddie that I can try a PFD with?

[Brandnick]

Yes unfortunately  it's being factored as part of your utilization and also as a baddie, so I would use the $2000 to help with the PFD. I would offer the 40% of the debt and see what they say. but get it in writing before you pay. 

Also most importantly is get your utilization down to 1-9%