topic Re: question?? in General Credit Topics

question??

Anonymous — Thu, 10 May 2007 07:11:55 GMT

soim new to the whole credit thing and right now im currently working on my credit and my husbands. if we have an account that has a balance of 1,600 and we pay 1000.00 would that help our credit go up?? how does it work?? we have a few cc that need to be paid off but i wanted to start with the ones that have a higher balance. any advice on this would be great!!! thanks!!!!!!!

Re: question??

Anonymous — Thu, 10 May 2007 07:32:22 GMT

@Anonymous wrote:
soim new to the whole credit thing and right now im currently working on my credit and my husbands. if we have an account that has a balance of 1,600 and we pay 1000.00 would that help our credit go up?? how does it work?? we have a few cc that need to be paid off but i wanted to start with the ones that have a higher balance. any advice on this would be great!!! thanks!!!!!!!

One of the factors that figures into your credit score is what percentage of the limit you are using on each of your revolving accounts. This is called utilization. If you have a credit limit of $1000, and you have $990 charged, your utilization is 99%. High utilization is bad. The higher, the badder.

So to answer your question, I'd have to know your credit limit, because that's the denominator of the utilization "fraction." If your credit card has a $2000 limit and you go from $1600 to $600, that would drop your utilization from 80% to 30%, which would give you a FICO boost of...oh...probably ten points or so. OTOH, if your limit is $10,000, you'd be going from 16% to 8%, gaining maybe a point or so, if anything at all.

Re: question??

Anonymous — Thu, 10 May 2007 07:56:55 GMT

morenita2106,

What are the balances, limits and APRs of all your CCs? Knowing that will help a lot in advising you.

Re: question??

Tuscani — Thu, 10 May 2007 12:05:49 GMT

More importantly, pay down the cards that are costing you the most money!