topic Re: Credit score in yhe pooper..which cc to pay off first in General Credit Topics

Credit score in yhe pooper..which cc to pay off first

Anonymous — Wed, 21 Feb 2018 17:48:59 GMT

Morning All,
My cc and scores have taken a huge hit. I have several 60 later and went from 630 to 495 on my credit score.
I have 10k to pay of cards. Which ones should I pay first. And, how long will it take to gain My scores back?? Thanks in advance for your help.
My cards are as follows (I am not sure about the interest rates)
Barclays. 2,120/2,100
Merrick. 1,388/1,400
Cap1. 296/300
Cap1. 735/750
Wal-Mart. 44/100
Macy's. 1,678/1,600
Kohl. 274/300
Navy cc. 2,614/2,600
Navy cloc. 4,982/5k
Comm cc. 2,200/2,400
Loan. 2,400/3k

Re: Credit score in yhe pooper..which cc to pay off first

HeavenOhio — Wed, 21 Feb 2018 17:21:03 GMT

Besides the interest rates, knowing the cards' limits would be helpful too.

But based on the information at hand, I'd snowball the small balances. Many are so low that they're nothing more than nuisances. And I'd pay off Barclays because they're touchy.

Re: Credit score in yhe pooper..which cc to pay off first

Anonymous — Wed, 21 Feb 2018 17:50:48 GMT

Thanks for the reply
I have added the credit limits

Do you know how long it may take for my score to rebound??

Re: Credit score in yhe pooper..which cc to pay off first

Anonymous — Wed, 21 Feb 2018 17:54:35 GMT

Pay off the smaller ones first, or the highest interest ones. Once you get your utilization down (which is intense right now), your scores will gradually increase.

Re: Credit score in yhe pooper..which cc to pay off first

Anonymous — Wed, 21 Feb 2018 18:05:37 GMT

@Anonymouswrote:
Pay off the smaller ones first, or the highest interest ones. Once you get your utilization down (which is intense right now), your scores will gradually increase.

(continuing this post...)

But the 60 day lates are going to continue to hold your score down some. As soon as you pay off some of those accounts you will get points back. Make sure you pay off completely at least 50% +1 of your accounts so you have more than half of your accounts reporting a zero balance and that will give you another score boost. Once you have paid off 1 more than half of the accounts, if it were me I would try to get all remaining balances below 79%, and work on snowballing them from there.

Re: Credit score in yhe pooper..which cc to pay off first

Anonymous — Wed, 21 Feb 2018 19:15:46 GMT

If you have 10k to pay these down, I'd start by paying each down to 75% of the limit. According to my calculations, you'll need $4143 to do this. Then take your pick, either start with the smallest balance and pay it off, then the next smallest, etc., or pay the card with the highest APR first. Paying the highest APR first will reduce your costs, but paying off the smaller balances first will result in score improvement as multiple cards will then have a $0 balance. So pick your poison.

Here's the spreadsheet I made to come up with the values. The "Pay" amounts are the amounts to pay to bring utilization down to 80% for each account. I sorted by utilization, highest to lowest.

EDIT: Fixed formulas and changed to 75% utilization. I made the Walmart card a PIF since the balance is low.

Also, is the "loan" an installment loan or a revolving line of credit? If it's an installment loan, just make your usual payments to that, and concentrate on getting the cards paid off/down first.

	Bal	Limit	Util %	Over	75%	Pay	New Bal	New Util%
Macy's	1678	1600	104.88%	78	1200	478	1200	75%
Barclays	2120	2100	100.95%	20	1575	545	1575	75%
Navy cc	2614	2600	100.54%	14	1950	664	1950	75%
Navy cloc	4982	5000	99.64%	0	3750	1232	3750	75%
Merrick	1388	1400	99.14%	0	1050	338	1050	75%
Cap1	296	300	98.67%	0	225	71	225	75%
Cap1	735	750	98.00%	0	563	172	563	75%
Comm cc	2200	2400	91.67%	0	1800	400	1800	75%
Kohl	274	300	91.33%	0	225	49	225	75%
Loan	2400	3000	80.00%	0	2250	150	2250	75%
Wal-Mart (PIF)	44	100	44.00%	0	75	44	0	0%
Totals	18731	19550	95.81%			4143	14588	75%

Re: Credit score in yhe pooper..which cc to pay off first

Anonymous — Wed, 21 Feb 2018 19:05:38 GMT

Awesomeness!!!!

Thanks so much!!!!!
Do you know How long it will take to get back to 640 credit score???
I would like to buy a home in the late summer or fall

Re: Credit score in yhe pooper..which cc to pay off first

Anonymous — Wed, 21 Feb 2018 19:26:33 GMT

If you pay everything down to 75% per my spreadsheet above, you'll have enough remaining to pay off Kohl's, both Cap1s, Walmart, Macy's, and Merrick, which will give you 6 accounts with zero balances right off the bat, and you'll still $1486 to pay down another balance. That should boost your score some. Whether you'll break 650 I don't know, with 60 day lates it's going to be tough.

Re: Credit score in yhe pooper..which cc to pay off first

Anonymous — Wed, 21 Feb 2018 19:27:00 GMT

Also.... Should I pay them down to 80% and then within a few days start paying off the balances, or should I wait 30 days to start paying on the balances?? Thanks

Re: Credit score in yhe pooper..which cc to pay off first

Anonymous — Wed, 21 Feb 2018 19:42:54 GMT

No, you can do everything at once, so your score goes up faster, and you save some on interest.

Pay off the 6 accounts I mentioned in my last post, then pay the rest to 75% utilization (my original post said 80%, but I changed it to 75% since you'll get better scores, plus I fixed my spreadsheet so the payment amounts are correct... re-read my original post).

Once you do this, depending on how much you can spare per month you can continue to whittle away at either the lowest balance, or the highest APR balance, depending on your goals and how quickly you want to get things paid off. Your balances will continue to go up due to interest charges, so keep that in mind as you run the numbers.

Re: Credit score in yhe pooper..which cc to pay off first

Anonymous — Wed, 21 Feb 2018 20:10:36 GMT

Good stuff..... Will keep you updated

Thanks again!!

Re: Credit score in yhe pooper..which cc to pay off first

HeavenOhio — Wed, 21 Feb 2018 21:13:01 GMT

@Anonymouswrote:
Pay off the 6 accounts I mentioned in my last post, then pay the rest to 75% utilization (my original post said 80%, but I changed it to 75% since you'll get better scores, plus I fixed my spreadsheet so the payment amounts are correct... re-read my original post).

The generally accepted utilization thresholds are at 8.9%, 28.9%, 48.9%, 68.9%, and 88.9%. Getting everything below 88.9% is huge. Bringing balances down to 75% probably won't further increase the OP's score, but it's going to give her a nice cushion against interest that's going to continue to be charged.

Getting rid of all of the small balances is likely to be a nice help too as it reduces the number/percentage of cards reporting positive balances. Plus, it gets those cards out of the OP's hair.

Moving forward, it's difficult to tell how helpful crossing 68.9%, 48.9%, and 28.9% will be. It really depends on one's profile. Crossing one or two of those thresholds will likely help, though. It's just tough to tell which ones. Crossing 88.9% and 8.9% tends to help almost everyone.

At any rate, I think LowLimits has set things up well. Stop all cards from being maxed, and eliminate the small balances entirely.

bunnimom, when you pay a card off, make sure you check the following statement for any trailing interest that might be charged. Those amounts are likely to be small enough that there should be little issue paying them immediately.

Re: Credit score in yhe pooper..which cc to pay off first

Anonymous — Thu, 22 Feb 2018 00:27:32 GMT

I wasn't sure what the threshold was which is why I picked 75%. Since the important one according to HeavenOhio is 88.9%, I recalculated the pay-down amounts for an 80% utilization:

	Bal	Limit	Util %	Over	80%	Pay	New Bal	New Util%
Macy's	1678	1600	104.88%	78	1280	398	1280	80.00%
Barclays	2120	2100	100.95%	20	1680	440	1680	80.00%
Navy cc	2614	2600	100.54%	14	2080	534	2080	80.00%
Navy cloc	4982	5000	99.64%	0	4000	982	4000	80.00%
Merrick	1388	1400	99.14%	0	1120	268	1120	80.00%
Cap1	296	300	98.67%	0	240	56	240	80.00%
Cap1	735	750	98.00%	0	600	135	600	80.00%
Comm cc	2200	2400	91.67%	0	1920	280	1920	80.00%
Kohl	274	300	91.33%	0	240	34	240	80.00%
Loan	2400	3000	80.00%	0	2400	0	2400	80.00%
Wal-Mart (PIF)	44	100	44.00%	0	80	44	0	0.00%
Totals	18731	19550	95.81%			3171	15560	79.59%

This leaves you with $6829 to pay off balances. Adding those in to pay off the lowest balances, here's an updated sheet:

	Bal	Limit	Util %	Over	80%	Pay	New Bal	New Util%
Macy's	1678	1600	104.88%	78	1280	1678	0	0%
Barclays	2120	2100	100.95%	20	1680	2120	0	0%
Navy cc	2614	2600	100.54%	14	2080	534	2080	80%
Navy cloc	4982	5000	99.64%	0	4000	982	4000	80%
Merrick	1388	1400	99.14%	0	1120	1388	0	0%
Cap1	296	300	98.67%	0	240	296	0	0%
Cap1	735	750	98.00%	0	600	735	0	0%
Comm cc	2200	2400	91.67%	0	1920	1949	251	10%
Kohl	274	300	91.33%	0	240	274	0	0%
Loan	2400	3000	80.00%	0	2400	0	2400	80%
Wal-Mart (PIF)	44	100	44.00%	0	80	44	0	0%
Totals	18731	19550	95.81%			10000	8731	45%

This pays off 7 accounts in full, and one partial with the remaining (Comm cc). The rest are paid to 80% utilization, and as you can see, this brings your aggregate utilization down to 45%, which is much better than 95.81%!!!! If you can manage another $251 or so, you can pay the Comm cc off as well.

Re: Credit score in yhe pooper..which cc to pay off first

HeavenOhio — Thu, 22 Feb 2018 01:17:51 GMT

I like this plan.

Threre are three factors in the utilization portion of one's score. Overall utilization is the most important. There's also individual card utilization, which is determined by the card with the highest utilization. And there's number/percentage of cards reporting balances. This plan attacks all three.

For overall utilization, the OP crosses three thresholds. She'll see a decent gain for crossing one or more of them. For individual card utilization, she crosses the threshold that hurts the most. And number/pecentage of cards reporting positive balances is suddenly in great shape.

I also like the fact that this plan catches the Barclays card as they're probably the least tolerant among the OP's lenders. And it leaves Navy, which is likely the most tolerant. (Captial One is tolerant too, but those balances are small.)

I'll repeat this because it's important. After paying, check the following month's statements for any trailing interest charges, and catch those right away.