What is the best way to....

[Anonymous]

Make long story short, some serious thing came up and forced me to use all my credit card and almost max out.  I got hit really bad with fico score, now my situation is covered and settled, time to starting paying my debts.

Question is

I have 4 credit card that I almost max out...I would like to know what is the BEST way to regain back my credit card.  Which option below would be best way.

1.Pay ALL credit card $100 on each card a month plus minimun charge on all 4 cards.

2. Focus to pay off 1 card first $400 a month, and pay minimun on other 3 cards.

3. Paid off the higher intereste APR first

4...open for other option.

What option is best to regain my fico score?

credit limit are

1. 12K

2. 5K

3. 5K

4. 5K

[Anonymous]

Since three of the four cards have the same CL I would recommend starting with focusing on the card with the highest APR. What are your scores? I know you said you took a hit but if they aren't too bad you may want to see if you pre-qualify for the Cap1 Quicksilver which has a 0% APR until January 2017 on balance transfers.

Or if you have access to a credit union.... you may want to look into taking a personal loan at a lower rate. This way you can hopefully payoff one or some of these cards and your payments will go farther in terms of paying downow the balance. 

I'm glad things are better now for you... now you just have to roll up your sleeves and start working hard. I've been in a bad spot before so I caneed relate. Spent the last 3-4 years rebuilding my credit... it was a long road but with hard work and some patience... it is finally starting to pay off.

[Appleman]

Sorry to hear about your troubles but glad you are seeing the issue in front of you. 

The best bang for the buck score wise will be to pay each card below 90% utilization. Meaning once the statement cuts plus the newly accrued interest the balance will be 89% of your credit line or less.

For each of the $5,000 cards that magic number is $4,450. Personally I would pay the minimum + a few bucks on each card and put the rest toward one of the $5,000 CL cards.

With the $12K card your number is $10,680 or less reported on the card to fall below 90% utilization.

So my first milestone would be evey card below 90% utilization. I agree that if the interest rates are different between cards you would want to pay the highest interest rate card down first.

Try a free program like undebt.it to see how long the process will likely take to pay off the debt. 

What do people think about tackling Chase versus Cap1 first? OP has a lot of exposure with Cap1. Are the prone to balance chase, I know from past experience Chase has been known to balance chase.

Good luck

[Anonymous]

Thank you all for the repply...

I dont want to apply for another cards or open another credit union to pay these credit off. Another words I just want to pay these credit card down. 

All my card are slightly below 90% ulization. Before my utilization was under 3%, its a big jump so my score was 735, now its about 620 fico score.  I work hard to get my score from 515 to 735 for the last year and half. But situation change everything.  

I just want to know what make the most sense to pay at the same time to improve my score back again.  3 of my cards with 5K are Cap1 and 12K are Chase Freedom.

[SouthJamaica]

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@Anonymous wrote:

Make long story short, some serious thing came up and forced me to use all my credit card and almost max out.  I got hit really bad with fico score, now my situation is covered and settled, time to starting paying my debts.

Question is

I have 4 credit card that I almost max out...I would like to know what is the BEST way to regain back my credit card.  Which option below would be best way.

1.Pay ALL credit card $100 on each card a month plus minimun charge on all 4 cards.

2. Focus to pay off 1 card first $400 a month, and pay minimun on other 3 cards.

3. Paid off the higher intereste APR first

4...open for other option.

What option is best to regain my fico score?

credit limit are

1. 12K

2. 5K

3. 5K

4. 5K

---

It depends on whether your priority is (a) score improvement, or (b) saving of interest, or (c) psychological reinforcement.

If (a) pay minimum + $5 on 3 accounts, and on one of the 5k accounts get the balance down to ~ 75% of limit, then do the same with each of the other accounts, until you're at ~ 75%, then work on getting down to ~ 45%, then work on getting down to around ~25%.

If (b) pay minimum + $5 on 3 lowest interest rate accounts, and on the highest interest account concentrate on getting the balance down to zero.

If (c) pay minimum + $5 on 3 largest balance accounts, and concentrate all other money on getting the smallest balance account down to zero. Then move on to next smallest account.

[SouthJamaica]

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@Anonymous wrote:

Thank you all for the repply...

I dont want to apply for another cards or open another credit union to pay these credit off. Another words I just want to pay these credit card down. 

All my card are slightly below 90% ulization. Before my utilization was under 3%, its a big jump so my score was 735, now its about 620 fico score.  I work hard to get my score from 515 to 735 for the last year and half. But situation change everything.  

I just want to know what make the most sense to pay at the same time to improve my score back again.  3 of my cards with 5K are Cap1 and 12K are Chase Freedom.

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Concentrate on getting each of the 4 accounts down to 79% or lower utilization, then to 49%, then to 29%, then to 9%, then getting 3 accounts to zero with 1 account reporting small balance.

[takeshi74]

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@Anonymous wrote:

I have 4 credit card that I almost max out...I would like to know what is the BEST way to regain back my credit card.  Which option below would be best way. 

---

Calculate revolving utilization on your credit cards.  Get them alll down ASAP.  If you have maxed (>90%) then work on getting them all down to 90%.  Then get them all down to 75%.  Then all down to 50%.  At that point you may want to swtich to focusing on APR.  With maxed or nearly maxed cards (and even with just high revolving utilization) you need to get revolving utilization down ASAP to avoid adverse action as that will make matters even worse.

Set up a spreadsheet with current balances and limits.  Calculate current revolving utilization.  Add a column for payments.  Play with the amount you have to pay all cards so that you get all them down as much as possible with the funds you have.  Repeat until revolving utilization is under control.

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@Anonymous wrote:

What option is best to regain my fico score? 

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Score is the least of your concerns at this point.  You're not going to apply for any new credit or make use of scores until you get your revolving utilization drastically dropped.  After you have it down then you can consider score.  Your scores will recover as your revolving utilization drops anyway.

Make sure you're addressing the reasons why you ended up in this situation.  Make sure you're budgeting and sticking to it.  Work on establishing a liquid reserve.  Do not rely solely on credit for emergencies.

I know all this sounds easier than it is to actually do but I've been through it myself and I have been balanced chased.  You definitely don't want to experience that or other forms of AA.

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@Anonymous wrote:

I dont want to apply for another cards or open another credit union to pay these credit off.

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That won't be an option anyway with your situation.  You're not likely to get an approval with revolvling utilization like that.  Even if you are approved the high revolving utilization will severely restrcit the limits that you qualify for.

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@Appleman wrote:

What do people think about tackling Chase versus Cap1 first?

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Doesn't matter.  Dropping revolving utilization is the OP's focus regardless of creditor.  It's never just the account with the creditor that matters.  Any creditor will routinely SP an individual to see what's going on with the person's other credit accounts.  Even if revolving utilization is brought under control with one creditor that creditor can AA based on high revolving utilization (and other credit profile issues, if applicable) with other creditors.

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@Appleman wrote:

Are the prone to balance chase, I know from past experience Chase has been known to balance chase.

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It is not just about the creditor.  Any creditor can take adverse action including CLD, balance chasing, account closure, etc if the activity is deemed to be beyond the creditor's risk tolerance.  Maxing all revolving accounts and staying at high levels of revolving utilization can potentially be a problem with any creditor.