Pay more towards cc balance or save for down payment?

[Anonymous]

We will be buying a new car within the next 2 months, so I am doing what I can to raise my scores (even a few more points) before we apply for an auto loan.

Current info:

-credit card limit is $22,500

-balance $12,600

-$5,500 payment scheduled to post on Sept 1 due date

-cc typically reports balance around the 7th of the month

Question, should I pay down the cc balance even more, or save any extra cash for a down payment?

Right now, I have an extra $2500 to work with.

[Anonymous]

Welcome to the board.  Before we begin, can you list the cost of car and how much you are planning to put down?  Also, what year is the car you are planning to purchase?

[Appleman]

After your credit card payment of $5,500 posts you will be at 31.5-35% utilization (depends on interest charged last month that will be added on).

 If you pay the full $2,500 you have available you will be down 20.4% utilization.

I would try to pay down to below 29% reporting and save the rest for downpayment etc.

So, determine how much interest will be added this month (probably similar to last month) and pay enough to get down to less than 29% (A reported balance of $6,500 or less would work.)

My thought process is that you should see a score boost for being below 30% utilization. There may be a another boost for below 20% but since you will not quite get there, I would recommend paying to 29% or less utilization.

Many factors are in play so this is my educated guess and free advice....

[Anonymous]

Thank you both for your responses.

So, I took your advice and paid my cc down below 29% utilization.  September's statement reflects these payments and utilization.  Now, I just need to wait for it to be reported/reflected on my CR.  That typically happens around the 7th/8th of each month.

All extra cash from this point on, will be saved for down payment.  I can likely pull together at least 5k for a down payment, if we purchase towards the end of September.  It really depends on how much overtime I come into in the next few weeks.  I typically work a minimum of 50 hours per week, and can potentially work over 80 hours a week.  Overtime is not predictable.  I only budget for a 40 hour paycheck, so any overtime can be used for down payment.

We are planning on purchasing a 2017 Chevy Tahoe, with a price range of 41k-49k. 

[Appleman]

Wishing you luck. It is unclear what the current Houston and Florida situations are going to do to the car supply. My guess is prices may climb as there will be a temporary need for new inventory.

[Anonymous]

Good thought Appleman.  Not one that I am happy to think about, but a possible/probable issue to be aware of!

Fortunately, I received my auto loan approval with NFCU this morning (still waiting to find out the specifics on the loan). 

We know the exact auto that we want to purchase.  Next step is to find the dealer with the best price.  Perhaps, we can get this all wrapped up this week!

Thanks for your input Appleman!