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New Visitor
Posts: 2
Registered: ‎05-22-2013
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best spent money to improve credit score

I have a few cards with very little credit left available on these individual cards. I have been paying them off a little at a time and have not been charging any more with them for the last few months.

I have one other card that has a zero balance. (This one has the highest interest rate.)

I have another that I am considering paying down so that I will have more than 50% available of the credit limit on this card. (This one has the 2nd-highest interest rate.)

I also have two other cards that Chase closed when it took over from WAMU. Both of these cards still have balances owing.

I have been making at least the minimum payments for more than ten years. (one payment in that time 30 days past due).

Lately, I have been increasing my payments and am zeroing in on raising my credit score back up to excellent.

With all of the above considerations, where will my money be best spent on making payments to these cards?

Thanks in advance for helping me figure where to concentrate the most in paying down my existing accounts.

Established Contributor
Posts: 640
Registered: ‎11-20-2012
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Re: best spent money to improve credit score

If you haven't read this thread, I would recommend it, so you know how FICO scores are calculated:  http://ficoforums.myfico.com/t5/Rebuilding-Your-Credit/Your-Guide-to-Credit-Scoring/m-p/718550#U7185...

 

The biggest boost to someone's credit score is usually to look at their utilization; it also sounds like you want to get these paid off, which is good. For maximum score benefit, you'll want to have all revolving accounts except one at a zero balance, and the remaining card reporting at less than 10%.

 

If it were me, I would continue to keep the zero-balance, highest interest rate card at a zero balance. (You may want to charge something small on it, $5-10, every few months so the lender sees it's still being used. But paying it right off is fine.) I would then pay down the 2nd highest rate card as fast as possible. Then after that, the Chase cards. Something to watch for, though: if your Chase cards are reporting as over the limit or are close to the limit, that might be a situation where you could consider whether they should get a higher priority. You haven't said, though, so that's an unknown.

 

 

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