topic Re: Is this ok to do? in Credit Cards

Is this ok to do?

oracles — Thu, 03 Jul 2008 04:30:56 GMT

i have 2 citibank credit cards that have balance transfer of 0 percent and $75 dollars balance transfer fee. I want to put all my debt from my other cards on these accounts and only have two cards with balances on them but maxed out. Will this be looked at negatively? What should i expect if i do this? thanks

Re: Is this ok to do?

Anonymous — Thu, 03 Jul 2008 06:42:51 GMT

I generally recommend against maxing out any single card or couple of cards, or sloshing around debt from card to card.

The FICO algorithms are pretty wise to that sort of thing. Now if you can get a couple of new cards and not put anything on them, that will lower your overall utilization, and may be worth pursuing. Likewise, if we're talking balances in the high thousands of dollars, you're currently paying 17.9%, and the new cards are 0% for the first six months, then you've got a pretty compelling non-FICO rationale for the transfer.

Re: Is this ok to do?

oracles — Thu, 03 Jul 2008 07:00:24 GMT

actually i got two new credit cards with 9k total and it is in the thousands so that is why i am doing it. I know i probably will get a major ding. How much of a pt decrease do you think i will get and how long do you think it will take me to make those points back up? thanks

Re: Is this ok to do?

marty56 — Thu, 03 Jul 2008 22:29:11 GMT

Be careful with the BT. Some CCCs will require you to close the accounts you are BT'ing which could have a longer term effect on your scores due to account age. Effects of util only last as long as it takes to pay down the balance and then for the balance to report. 9% or less total util is the best. I dont know about new accounts butI have read here that it takes a few months for scores to go up and a year nefore the account is not marked as new. Also remember average account age is a factor and the effect of it could last longer based on your profile.

Also never do a BT unless you can PIF by the term date. Never ever do this. Also this all will be a mute point if you run the other cards back up again.

Message Edited by marty56 on 07-03-2008 03:29 PM

Re: Is this ok to do?

oracles — Thu, 03 Jul 2008 18:38:33 GMT

thanks marty, i am not going to run the cards aback up, i just want to take advantage of the 0 percent until jan. Putting it on these two citicards will help me pay off the balances quicker. I know i am going to get ding but just wanted to know how much and how long it will take to make them up and will i get any other ccc upset. I dont want them to give me a cld.

Re: Is this ok to do?

marty56 — Thu, 03 Jul 2008 22:36:16 GMT

I found out for my credit profile it didnt matter if I had a single CC above 9% util (11%) as long as my total % util was 9% or less. I dont know if that was because the single CC was at 11% and would it have been different if the single CC was at 90% util with 9% total util.

Anyway is sounds like you have a plan so good luck with it and remember any score drop you got will only be temporaray and then you should be good to go.

BTW I recommend National City Visa since they have a great BT offer. LOL I dont think they are happy with me since they didnt make any money with the BT so if you apply dont tell them you know me.

Re: Is this ok to do?

Anonymous — Fri, 04 Jul 2008 06:53:24 GMT

i say if it helps you financially on paying down your credit cards quicker and you don't need your scores high at this moment. Do it!!! good luck

Re: Is this ok to do?

Anonymous — Sat, 05 Jul 2008 02:22:32 GMT

oracles wrote:
thanks marty, i am not going to run the cards aback up, i just want to take advantage of the 0 percent until jan. Putting it on these two citicards will help me pay off the balances quicker. I know i am going to get ding but just wanted to know how much and how long it will take to make them up and will i get any other ccc upset. I dont want them to give me a cld.
oracles,

I was told when one does this, to keep their overall utilization on their cards at or below 50% atleast and not to use over 50% on each individual card, but if that wasn't possible then to use no more than 70% on each individual card , but in no instance were they to use over 90% of their credit line on each individual card EVER!

I have used 80% of my credit line on one card before and was dinged 12 points. I did ask for a CLI too which helped lower my utilization in the process.

i agree with the last poster that if this is going to benefit you and save you money, then by all means do it! Especially if you aren't about to buy a home or a new car.

Sandy

Re: Is this ok to do?

Anonymous — Sat, 05 Jul 2008 02:59:44 GMT

Forget about your scores for a second, since utilitzation is factored based on present util only. Do what's best for you financially right now, and then worry about utilization when you need good scores for a major purchase. FICO won't care what your util was before you paid the balance down.

Re: Is this ok to do?

oracles — Sat, 05 Jul 2008 05:45:43 GMT

thanks everyone for your response, i appreciate it tremendously, actually my utilization is 30% right now. I just want to put all the money i owe on these two cards which will require using the entire limit on both so i can take advantage of the 0 percent BT. I will have overall 30% util but almost 99% on two cards only and the rest 0 balance. Then i can pay off the 2 citi cards faster. With this situation, will i upset other ccc and get a cld and will i have a major decrease in score ( how much do you think). I am not looking to purchase a house or car so it is not that important about the score so much as to just being curious. My major concern is if i will get a CLD from other credit cards i have like Amex. thanks

Re: Is this ok to do?

mrlimo — Sat, 05 Jul 2008 12:44:21 GMT

A few years back I transfered all my debt to 1 card with 0% from 3 cards. None of the other 3 c.c.c's gave a CLD in fact I think I got an automatic CLI shortly after from the 1 c.c.c. due to an aniversry on that card. The biggest advise I can give you on doing this make sure 1. you sock drawer the 2 cards until PIF, 2. If either card has an auto pay such as an easy pass replentish, cell phone bill, etc. to take off of auto pay until card is PIF. Any charges you make to either of these two cards while you have a 0% rate the payment you make will be applied to the 0% rate first and the remaining regular interst rate charge will sit there and accure interest until the promotional period ends or the 0% portion is PIF and then starts to pay on the anual % rate next.

When I did mine I took the amount I was transfering divided that numeber by the 6 months of 0% rate and that was what I made in my head my minimal payment amount. But like I said I only had it all on 1 card. For you I would pay minimal on one card and pay the difference of that number you came up with to the 2nd card with the lowest ballance. That way you can quickly get 1 card with a high util and the other PIF. As the second card is PIF apply that money to the first card to get it PIF by the end of the 0% promotinal period if possible.

If you are at 99% util on both cards be extra carefull with both of them. If you send either of these cards to or over the 100% mark your cards COULD come crashing down with your CLD's, OVER LIMIT FEES, 0% promotional rate canceled for default, etc.

Re: Is this ok to do?

haulingthescoreup — Sat, 05 Jul 2008 14:47:14 GMT

If you do have an AmEx, that's definitely grounds for thought, although they will be able to tell that you don't have new debt, you just parked it somewhere else for a while.

I couldn't tell for sure if you have one, but if you do, which card, how long, and what's your usage and payment pattern?

I see the logic in the BT, but I would only move over enough to keep it at 90% or less on each, including the $75 fees, and pay them down frantically fast, at least until I got them at 49% or less. You'd have to still pay a bit of interest on whatever you didn't transfer, but that little 10% cushion could save you.

And as the others said, mark it off on a calendar to have it paid off by the end of the promo period. With some CC's, if you don't pay in full before the 0% is up, they will charge you interest on the original amount, as if you had never paid the rest off at all! Read the agreements carefully, and even then, realize that there might be something hidden in there.

And finally, bury the cards deep in the sock drawer so that you don't accidentally use one for a charge.

Financial benefits beat scoring benefits in cases like this, but you do want to watch out for collateral damage with other companies, as you are doing. Good luck!

Re: Is this ok to do?

oracles — Sat, 05 Jul 2008 16:15:59 GMT

thanks for the response. I will definitely sock drawer these cards. I have an Amex blue card that has a BT on it 3.99%. I will pay this off with the new BT. I always paid the minimum. It is 3.99% for the life of the BT. I've had the card since jan/2007.