Newbie here with alot of questions!!

[Anonymous]

Hi i'm a newbie here and i am looking for some advice, I am working on paying my credit cards off, I currently have $10,500 left to pay off.  I recently transferred my balances to one card with a 1.99% rate until march 2010, was this a good idea? I thought it made sense for me because it was easier to consolidate to one payment.

Does doing a balance tranfer negatively effect my credit score?  

Last time i checked my creit score i was 721 (experian i think) last year.  I have never had a late payment or delinquent account, I also have 20,000 in student loans that are currently in defferment because I am back in school working on my masters degree.

here is my creit card info:

AMEX Gold - No limit - pays balance every month

Chase visa - 8.99% rate $2850 limit - $0 balance

Discover -  6.99% rate - $3500 limit - $0 balance

BOA MC - 5.90% rate -$8500 limit - $0 balance

Citibank MC - 9.99% rate - $10,440 limit - $0 balance

BOA Visa - 9.24% rate  - $12,000 limit - $10,500 balance

i also have a $1000 credit line associated with my checking account that has no balance.

so my total credit line with the cards and that credit line is $38,290,  with a $10,500 balance is that a decent percentage?

Around 3 months ago I called all of my card companies and had my rates lowered, after they told me what they could lower it to, i asked to speak with a supervisor to see if I could get a lower rate, and they lowered it even more (I saw this on TV, maybe Oprah..and it worked great!!)

When i transferred my balances to my BOA Visa i only had a $4,000 limit on that card, in order to take advantage of the 1.99% rate on balance transfers they increased my limit $8000  from $4000, to a total of $12,000 and lowered my limit on my BOA MC from $16,500 to $8500. Does this effect my credit score at all?

I use all of my credit cards (except the one with the balance) at least once every 6 months to keep them active and i pay the balance right away..i usually just use them for gas or hotel stays to keep them active.  Is 6 months the proper time or should i use them more often?

One final question, should i check my credit scores now, it has been over a year and a half since i have looked.  the only reason i don't want to look is my fiancee and I are getting married in september and want to purchase a house afterwards, so i don't know if it will effect our score if we both look at our reports now and then have inquiries again when we start the house hunting process.

Thank you for all of your help with all of my questions!

[Anonymous]

Hi and welcome to the forum

1.  Yes it is a good idea to get as low of interest as possible, so the 1.99 vs. up to 10% is a good financial decision, which should be your foremost concern, not FICO.

2.  The new inquiry will affect you very little. 

3.  The BoA account you transferred to is an existing account, so you won't be negatively affected by any new account for BT.

4.  Your collective total balances and CL's have not changed, so you won't see any utilization percentage FICO changes.

5.  The number of accounts with a balance has been reduced.  This will improve your FICO.

6.  Your interest charges are reduced.  Do not pay any reduced dollar amount, just apply the difference toward principle to pay the debt off even faster (this is why it is a good financial decision).

7.  By paying the interest savings toward the balance you will reduce the balances faster, which in turn reduces percentage of utilization which improves FICO.

8.  I personally believe that obtaining your FICO scores at least 1x per year in addition to your Free CR reports is a good idea.  I would "stagger" the reports and FICO.  Get FICO now, then in 6 months get CR's.  Then you have a good idea of credit health 2x yearly, because the FICO report contains CR data/info.  Some people even stagger the free reports, obtaining one of the 3 every 4 months.  Personally, I like to see side by side same time reports.

9.  Once you pay off the CC debt, divert the payments to SL's.  Just because you are in deferrment doesn't mean you shouldn't or can't get a head start of getting out of debt.  Make debt free a real goal.  You'll never regret it

Message Edited by txjohn on 05-02-2009 08:44 AM

[Anonymous]

Thank you so much for your great answers!!! I didn't know that there was a difference in getting my free credit report and FICO scores, thanks for the info!

As soon as the credit card is paid i will definitely be working on the student loan, I am paying the interest while I am in defferment, which isn't much but i figure its better than them adding it to the principal!

[haulingthescoreup]

Do be aware that you can no longer buy your FICO Experian score anywhere, although one or possibly two local credit unions provide it to members, and you find out when you do a mortgage app.

Sounds like you have a great plan going, and txjohn's advice is sound.

If you haven't already, please read Understanding Your FICO ® Score and Credit Scoring 101 (at least the first post.)

These will give you the background knowledge you need to understand what you read here on the forums, and it will help you know where you're going.

[Anonymous]

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@Anonymous wrote:

One final question, should i check my credit scores now, it has been over a year and a half since i have looked.  the only reason i don't want to look is my fiancee and I are getting married in september and want to purchase a house afterwards, so i don't know if it will effect our score if we both look at our reports now and then have inquiries again when we start the house hunting process.

Thank you for all of your help with all of my questions!

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Lots of good advice but neither addressed this question. Just want to be sure you know that checking your own credit will have no effect at all on your credit scores.  This is a different inquiry from the hard inquiries you receive when potential creditors check your report.

[Anonymous]

I just made the balance transfers in the middle of April, will it show up now if i purchase my FICO scores now or should I wait for a little while until i purchase the scores (i was going to purchase the FICO standard for both scores, but i want it to reflect my current status).

[Anonymous]

The updated balances may not report till normal end of statement.  Check after the date you normally see updates for the month.

[Anonymous]

The balance transfers posted to the BOA Visa account on 4/14, i just got my May statement showing the updated balance and balance transfer rate of 1.99%, do u think that means everything is updated regarding my FICO, or should I just play it safe and wait until mid may?

thank you again for all your help!

[haulingthescoreup]

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tl9606 wrote:

The balance transfers posted to the BOA Visa account on 4/14, i just got my May statement showing the updated balance and balance transfer rate of 1.99%, do u think that means everything is updated regarding my FICO, or should I just play it safe and wait until mid may?

thank you again for all your help!

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It's possible that the cards that you transferred from have not yet updated. BofA is generally much more prompt in this sort of thing. Chances are that each lender will update to the bureaus on their normal statement date, and it often takes a week (could be more) for all three reports to show the new balance. So it could easily be a month, depending on each card's reporting habits, for this to show up.

AmEx reports the balance on the statement, but they don't report it until 4 weeks after the statement, a couple of days before the next statement. So in effect, they're a month behind, and it will take 2 months to get the $0 balance to report.

HSBC/ Orchard bank cards (not store cards) and US Bank update on the last business day of the month, reporting the balance as of that date.

Some small/ local banks and CU's might also have funky reporting patterns, but the rest of the big lenders follow the statement date pattern, with the exceptions noted above.

Thumbs up to VEEinVegas for catching the part about the soft inquiries from pulling your own reports! I'd be in deep, deep trouble if all my report pulls were hards.

[Anonymous]

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@haulingthescoreup wrote:

Thumbs up to VEEinVegas for catching the part about the soft inquiries from pulling your own reports! I'd be in deep, deep trouble if all my report pulls were hards.

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     Wouldn't we all!!!!