topic Re: What to do? in Understanding FICO® Scoring

What to do?

jjr9106 — Fri, 03 Aug 2012 01:45:07 GMT

Hey Everybody!

Getting ready to refi, and I would like to bring my score up some first...

Debt

Revolving

CCard 1 - 8k balance on 16K max

Second Mortgage - 40K balance on 42K max

Installment

Car 1 - 14k left

First Mortgage 140K left

If you were going to throw 30K cash at that stack of debt to try to bump my score the most, where would you apply it?

Thanks for the help,

Re: What to do?

pizzadude — Fri, 03 Aug 2012 01:51:29 GMT

@jjr9106 wrote:
Hey Everybody!

Getting ready to refi, and I would like to bring my score up some first...

Debt

Revolving
CCard 1 - 8k balance on 16K max
Second Mortgage - 40K balance on 42K max

Installment
Car 1 - 14k left
First Mortgage 140K left

If you were going to throw 30K cash at that stack of debt to try to bump my score the most, where would you apply it?

Thanks for the help,
JR

If you are trying to bump your FICO score you should focus on your revolving debt. FICO weighs revolving debt much more significantly than installment debt.

Definately pay down the credit card. Double check your second mortage ~ are you certain that it shows as a revolving account on your credit reports ? Usually lines of credit over 25K are scored as installment loans I believe.....If it is really a revolving account then I would recommend paying it down as much as possible in addition to the credit card.

Don't worry about your first mortgage or car loan.

Re: What to do?

jjr9106 — Fri, 03 Aug 2012 02:08:06 GMT

Yeah, second shows up as revolving on experian and equifax, but not on transunion... strange. I thought, like you did, that large 2nd mortgage balances wouldn't show up as revolving...

Re: What to do?

jjr9106 — Fri, 03 Aug 2012 02:30:15 GMT

The more I read, I think that's what's hurting me. I have scores around 660, with no missed payments, nothing bad. But because that "2nd" is being treated as revolving, that 40K is killing me... Wonder if I can refi that 2nd into a fixed? Not sure what to do with it other than hammer down and get it paid off.

Re: What to do?

pizzadude — Fri, 03 Aug 2012 02:35:55 GMT

@jjr9106 wrote:
The more I read, I think that's what's hurting me. I have scores around 660, with no missed payments, nothing bad. But because that "2nd" is being treated as revolving, that 40K is killing me... Wonder if I can refi that 2nd into a fixed? Not sure what to do with it other than hammer down and get it paid off.

Can I ask where you obtained your scores ? Are they FICO scores ?

Re: What to do?

jjr9106 — Fri, 03 Aug 2012 02:38:54 GMT

I pulled all three from Experian... and they're all right around 670.

Re: What to do?

Repo-ed — Fri, 03 Aug 2012 02:48:02 GMT

@jjr9106 wrote:
I pulled all three from Experian... and they're all right around 670.

What you pulled are FAKO scores. Not REAL FICO scores. You really need to pull your TU and EQ scores from here, and if you have a Amex card, you can apply for a card you know you won't be approved for, to obtain your REAL EX FICO score.

Your scores could actually be much higher/lower than what experian FAKO scores are showing you.

Re: What to do?

Anonymous — Fri, 03 Aug 2012 02:53:02 GMT

Ah, thanks. I did that and my score is a 698. Much better. Thanks so much.

Re: What to do?

Quips — Fri, 03 Aug 2012 20:07:10 GMT

@jjr9106 wrote:
Hey Everybody!

Getting ready to refi, and I would like to bring my score up some first...

Debt

Revolving
CCard 1 - 8k balance on 16K max
Second Mortgage - 40K balance on 42K max

Installment
Car 1 - 14k left
First Mortgage 140K left

If you were going to throw 30K cash at that stack of debt to try to bump my score the most, where would you apply it?

Thanks for the help,
JR

If you have $30K to apply - I would pay off the CC and put the rest on the 2nd. You will improve your FICO since your total Utilization will go from 83% to 31% and should give you a big score increase. Also, by only having 1 of 2 revolving tradelines with a balance you should also see a jump. After that, you will see score increases when UTI goes below 30% and then under 10%

Good luck

Re: What to do?

apandabear — Fri, 03 Aug 2012 23:52:53 GMT

@Quips wrote:
If you have $30K to apply - I would pay off the CC and put the rest on the 2nd. You will improve your FICO since your total Utilization will go from 83% to 31% and should give you a big score increase. Also, by only having 1 of 2 revolving tradelines with a balance you should also see a jump. After that, you will see score increases when UTI goes below 30% and then under 10%
Good luck

+1.

Then try not to carry a balance on the CC until you have that 2nd mortgage paid off.

Best of luck!!