topic Re: paying off credit cards will it boost score in General Credit Topics

paying off credit cards will it boost score

ladyvg270 — Sat, 03 Jan 2009 00:19:39 GMT

Macy 100 cl bal 0

Imagine cl 480 bal 215

Visa from a credit union cl 500 bal 405

overdraft protection two of them total cl 1000 bal 300 on each

I would like to know if i pay them all down to 0 bal will my credit score go up?

I also would like to know if i have 20 inquires in two years, if i wait 6 months to apply for something once i have my balance at zero, do you think im more likely to get credit?

I also paid off a 6 month loan of 500$ i paid it every month on time for 6 months not one late payment on this loan or the accounts i listed up top NO late payments at all.

Re: paying off credit cards will it boost score

SCF — Sat, 03 Jan 2009 00:36:51 GMT

It sounds like you're well on your way to a great FICO score!

Ideally, you should have less than half of your accounts report a balance (for you this would be 1 or 2) and your total utilization be <10% of your total available credit, and your utilization on each card also be less than 10%. Note that you can achieve this by paying off a card before the statement date, so if you charge $99 to your Macy's card, but pay it before the statement, the $0 balance on that date will be reported to the CRAs.

So, to make it short and sweet, you should pay off all of your balances but one, and the balance that you leave should be <10% of your total credit on that account for what is generally accepted to be the maximum score boost. I would definitely start with the CU Visa, that very high util is probably not good for your scores.

Good luck!

Edited to correct tricksy math symbols that I hadn't used since high school. =P

Message Edited by SCF on 01-02-2009 05:36 PM

Re: paying off credit cards will it boost score

Anonymous — Sat, 03 Jan 2009 00:35:00 GMT

SCF wrote:
It sounds like you're well on your way to a great FICO score!

Ideally, you should have less than half of your accounts report a balance (for you this would be 1 or 2) and your total utilization be >10% of your total available credit, and your utilization on each card also be less than 10%. Note that you can achieve this by paying off a card before the statement date, so if you charge $99 to your Macy's card, but pay it before the statement, the $0 balance on that date will be reported to the CRAs.

So, to make it short and sweet, you should pay off all of your balances but one, and the balance that you leave should be >10% of your total credit on that account for what is generally accepted to be the maximum score boost. I would definitely start with the CU Visa, that very high util is probably not good for your scores.

Good luck!

<9% for max points in the util area. <10% is good, but you get more points, normally, for being under 9%. Some say that once you get below 3% you get a few more points, but this is hit and miss.

This is individual util and overall util.

Re: paying off credit cards will it boost score

marty56 — Sat, 03 Jan 2009 13:29:09 GMT

Having 1 card report a balance of 9% or less will give you the best result.

2 year clean payment histories are what creditors like to see on getting new credit.

IMHO with 20 INQs, you will probably get declined with the reason of seeking new credit. Slow down or stop your app process and let your credit age.

Re: paying off credit cards will it boost score

Anonymous — Sat, 03 Jan 2009 18:03:59 GMT

No doubt it will raise your score immediatelly you pay the balance off.