cancel
Showing results for 
Search instead for 
Did you mean: 

How much will my credit score be affected if I transfer my card's balance?

tag
Anonymous
Not applicable

How much will my credit score be affected if I transfer my card's balance?

I currently have a card with Capital One and am in good customer standing.   I have never been late on a payment.   They recently raised my rate to 17.9% and when I called to ask why they told me it was for "economic reasons and it is too complicated to go into the details".   Infuriating.  So, I was able to submit a request to lower the interest rate, which is very unlikely to happen.   I am considering transferring my balance to a credit union account with 8.5% fixed APR.  

 

How can I find out how much my credit score would be affected in doing this?

 

Thank you.

Message 1 of 4
3 REPLIES 3
GregB
Valued Contributor

Re: How much will my credit score be affected if I transfer my card's balance?

If you are trying to figure out exactly what effect there will be, lots of more info would be required and then you still won't have a perfect answer.

 

If you are transferring to an existing account, there will be little change. Perhaps a temporary drop if both accounts report the balance before the Cap One account reports the $0.

 

If you are applying for a new account, you will have some score drop from inquiry and new account. If the new account is installment and you didn't have any installment on your report, it might bring your score up a bit in a few months. Still not very big changes.

 

Bottom line is there won't be any big changes.

Message 2 of 4
Anonymous
Not applicable

Re: How much will my credit score be affected if I transfer my card's balance?

I will be applying for a new account.   My credit limit is $20,000.  My balance is $9500.   If I don't pay it down it could hurt my credit, right?  I will never pay it down with this interest rate. So, my options are either transfer to a new credit card account or take a loan out against my assets or my car title or something.  (I'd rather not take out a loan.)    

 

I am not quite sure what you mean by Installment.  

 

 

You have been very helpful and I greatly appreciate it!

 

 

Message 3 of 4
GregB
Valued Contributor

Re: How much will my credit score be affected if I transfer my card's balance?

There are three main types of account according to the Credit Reporting Agencies: Mortgage, Revolving (typical Credit Card), and Installment. Installment is like a car loan where you pay a fixed payment over a fixed time. You get a better score for having positive experience with all three types of accounts.

 

If you have a paid off car loan, I think you are already getting a score boost from that "experience". If you are adding a new installment loan at 8.5% from the CU, that will likely help your score as you won't have "too many" installment loans.

 

If we assume that is your only CC, then your aren't getting killed for a really high utilization. $9500 against a $20000 limit is 47%. It seems best to keep it under 9%, but up to 40% seems to be OK. You get really killed at 80%.

 

Changing to an 8.5% CC with the CU is a good idea. Changing to an 8.5% installment loan with the CU is even better. Any small drop will be temporary and your score should go up soon. AND you will save a bunch of interest! Just don't run the card up again!

Message 4 of 4
Advertiser Disclosure: The offers that appear on this site are from third party advertisers from whom FICO receives compensation.