topic Paying down/off CC and CMS in Credit Cards

Paying down/off CC and CMS

ambivalent — Wed, 02 Apr 2014 17:11:07 GMT

Hi Everyone!

Okay, so I have the CMS from USAA. I am considering paying off all of my credit cards to 0...when I enter this into the simulator, it says my score will drop about 60 points. Is that really likely? Even just paying them down it says my score will drop. I don't get it. When I gave the same scenario through the Capital One simulator, it raised my score by about 30. I know these are FAKO, I just want to know what to realistically expect. I ended up paying 2 of them off and the balance of the remaining 2 give me a util of about 23%. I'd prefer to pay them all off except one because I don't like debt! But I also can't afford a drastic score dip like that. :-\

Thank you!

Re: Paying down/off CC and CMS

adavis425 — Wed, 02 Apr 2014 17:22:56 GMT

@prettylady wrote:
Hi Everyone!

Okay, so I have the CMS from USAA. I am considering paying off all of my credit cards to 0...when I enter this into the simulator, it says my score will drop about 60 points. Is that really likely? Even just paying them down it says my score will drop. I don't get it. When I gave the same scenario through the Capital One simulator, it raised my score by about 30. I know these are FAKO, I just want to know what to realistically expect. I ended up paying 2 of them off and the balance of the remaining 2 give me a util of about 23%. I'd prefer to pay them all off except one because I don't like debt! But I also can't afford a drastic score dip like that. :-\

Thank you!

What seems to work best is paying all but one off. That one with a balance should report no more than 9-10% of your overall credit line. You may have to tweak this, but FICO def returns a better score with SOME balance. Not a lot. 23% is still high for the best score. Good luck!

Re: Paying down/off CC and CMS

ambivalent — Wed, 02 Apr 2014 17:32:15 GMT

@adavis425 wrote:
@prettylady wrote:
Hi Everyone!

Okay, so I have the CMS from USAA. I am considering paying off all of my credit cards to 0...when I enter this into the simulator, it says my score will drop about 60 points. Is that really likely? Even just paying them down it says my score will drop. I don't get it. When I gave the same scenario through the Capital One simulator, it raised my score by about 30. I know these are FAKO, I just want to know what to realistically expect. I ended up paying 2 of them off and the balance of the remaining 2 give me a util of about 23%. I'd prefer to pay them all off except one because I don't like debt! But I also can't afford a drastic score dip like that. :-\

Thank you!
What seems to work best is paying all but one off. That one with a balance should report no more than 9-10% of your overall credit line. You may have to tweak this, but FICO def returns a better score with SOME balance. Not a lot. 23% is still high for the best score. Good luck!

Okay...by overall credit line, you mean the total credit, not just the one on that card. My total credit lines = 4,800; total balances are 1100 on 2 cards - 1 with 400, the other with 700. Should I go on and pay the 700 off as well?

Re: Paying down/off CC and CMS

chwebb1 — Wed, 02 Apr 2014 18:02:39 GMT

Yes, just be sure to let something report. I personally only let $30 report across all of my credit lines (on my BoA Better Balance card so that I can get the quarterly reward).

Re: Paying down/off CC and CMS

ambivalent — Wed, 02 Apr 2014 18:22:03 GMT

@chwebb1 wrote:
Yes, just be sure to let something report. I personally only let $30 report across all of my credit lines (on my BoA Better Balance card so that I can get the quarterly reward).

Awesome! Thank you all! I just paid off everything except $400. I feel soooo freeeeeeeeeeeeeeeeeeeeeeeeeeeee.

Re: Paying down/off CC and CMS

adavis425 — Wed, 02 Apr 2014 20:31:03 GMT

@prettylady wrote:
@chwebb1 wrote:
Yes, just be sure to let something report. I personally only let $30 report across all of my credit lines (on my BoA Better Balance card so that I can get the quarterly reward).
Awesome! Thank you all! I just paid off everything except $400. I feel soooo freeeeeeeeeeeeeeeeeeeeeeeeeeeee.

Yaaaaaayyy!!!!!!! Just keep in mind future reporting should be 10% or less (but not 0) of overall cl on only one card. WTG!!