Does Credit Score Impact after Balance Transfers??

[Anonymous]

Opened 3 new accounts in which there are 2 balance transfer accounts as below.

Discover: 4500 (0% APR for puchases and balance transfer for 12 months)
Amex Everyday Preferred: 10,000 (0% APR for puchases and balance transfer for 12 months).

I would like to utilise 4000 and 9000 by transferring to other cards which I have balances. In this scenario I might be out of box of the theory of being under 30% utilization on these 2 new cards. I overall have 60,000 limits in total from 8 cards. Also my scores are down to 675 from 750 after these new accounts being added to my reports. And do not wish to apply any more (In fact will neither get approved any more apps I presume, also would like to join the Gardening club shortly).

My query is whether my score raises if I make minimum payments (with 50dollars addition) to these accounts after doing balance transfers (rest other cards will make full payments if any)  Or will it impact further down as the utilisation is high?

Thank you for replies in advance!!

[CreditInspired]

Hi @RKUM and welcome

Paraphrasing to see if I understand your question correctly.

You want to Xfr $4K and $9K from two other cards with balances to the new Disco and and AmX cards, respectively. If this is the case, the new UT for both cards will be 90%, which is bad and that’s with a capital B.

Will you leave balances on the other 2 cards or will both be PIF? I hope PIF because if not, you will have 4 CCs with balances which will drop your scores some more.

With your scores already low at 675 before the BT, they will most certainly drop quite a bit more by having a UT of 90% and this could possibly cause AA by lenders.

Also, please try and pay more than the minimum payment plus $50/month as you stated. That is small potatoes on $4K and $10K loans even if the APR is 0%. It’s prudent to divide the BT amount by 11 to ensure its paid off before the 0% expires in 12 mos. So paying Disco $364/mo and AmX $818/mo will ensure that you won’t start paying astronomical fees at the end of the O APR period.

GL2U

[Anonymous]

Hi Creditlnspired,

Thanks a lot for your detailed response, very much appreciated.

Based on your inputs I realise that the impact on my current score would go worse if I opt for my plan utilising 90% on the 2 new  cards. In this scenario I will NOT opt for this anymore.

Just out of curious, if in case  I go ahead and use the BT option with 90% utilisation on my new 2 CC's this month and after 4 months I pay back 4k and 9k completely, will that boost up my score? Does that make any good sense? 

Thank you 

[Anonymous]

I have a similar situation. I have a fresh CFU with a $5700 SL and wanted to move 750 from my Best Buy cars to the CFU but don’t want to because I’m afraid it’ll affect my score adversely. I did the credit simulator on the chase app and it went down. My util ratio on my Best Buy is 67% and XFern 750 would put it at 5%

[Anonymous]

Yah, me afraid too on the any adverse effect of scores..

Could someone PLease light on the below

if in case  I go ahead and use the BT option with 90% utilisation on my new 2 CC's this month and after 4 months I pay back 4k and 9k completely, will that boost up my score? Does that make any good sense? 

[polaris2011]

---

@Anonymous wrote:
I have a similar situation. I have a fresh CFU with a $5700 SL and wanted to move 750 from my Best Buy cars to the CFU but don’t want to because I’m afraid it’ll affect my score adversely. I did the credit simulator on the chase app and it went down. My util ratio on my Best Buy is 67% and XFern 750 would put it at 5%

---

Would need to know more for certain, but lowering your util from 67% on the Best Buy card to 13-14% (balance xfer + any fees) on the CFU card would stand to improve your score. Again, not knowing anything else about your other accts/profile.

Good luck!

[polaris2011]

---

@Anonymous wrote:

Yah, me afraid too on the any adverse effect of scores..

Could someone PLease light on the below

if in case  I go ahead and use the BT option with 90% utilisation on my new 2 CC's this month and after 4 months I pay back 4k and 9k completely, will that boost up my score? Does that make any good sense? 

---

At 90% util, you're almost sure to take a hit. I lost 20 points when my util on 1 card hit 50% and my overall util across all cards ticked up from 17% to 22%. Paying off the cards will improve your scores but it will likely not gain back all the lost points in 4 months time. Generally, I like to think that it takes at least 2X to 3X longer to regain the same amount of lost points, but that will vary on things like baddies falling off during the time period.

Hope that helps. I'm sure someone more knowledgeable than me will give you a bit more info.

Good luck!

ETA: Also, be sure to check you can actually Xfer that much on your cards. Some cards cap the xfer amounts and don't forget that any bal xfer fees would be included in that unless you have no fees for the xfers.