12-10-2012 09:23 AM
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?
12-10-2012 10:41 AM - edited 12-10-2012 11:00 AM
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.
- 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
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
12-10-2012 02:31 PM
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?
12-10-2012 03:33 PM - edited 12-10-2012 03:41 PM
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%