maximizing credit score help

[Anonymous]

Hey yall,

I have two credit cards and both are maxed out($3200,$1800) I now have the money to pay off the the cards.  My question is, is it better to pay the full balance off the cards or pay half then half later?  I want to gain max points toward my score.  I need to buy a car

Thanks!

[Anonymous]

sorry wrong place for this!!

[Anonymous]

Welcome to the myFICO forums, amm1232710!

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amm1232710 wrote:

Hey yall,

I have two credit cards and both are maxed out($3200,$1800) I now have the money to pay off the the cards.  My question is, is it better to pay the full balance off the cards or pay half then half later?  I want to gain max points toward my score.  I need to buy a car

Thanks!

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Pay in full to rid yourself of interest and finance charges-- if you carried a balance during your last billing cycle, then you can expect some finance charges to be added for the next billing cycle. You might want to account for those finance charges and pay them (now) on one card, and let the finance charge report (as long as it's no more than 1 to 9%  of the credit line for that card) on the other so that you have a small balance. Let it report, then PIF as soon as the statement drops so that you don't incur any more interest. Some people (myself included) get a small boost for showing some credit utilizaiton on one card with the rest reporting a zero balance.

[Anonymous]

so ill get the same number of points if i pay in full then paying half and half?

[Anonymous]

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amm1232710 wrote:
so ill get the same number of points if i pay in full then paying half and half?

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No...no! As far as maximizing utilization points goes, there's a big difference between 50% and less than 10% utilization (usually & as a good rule of thumb). You should get an appreciably higher bump from paying in full than you'd get from paying down to 50%.

[Anonymous]

Thank you!

[Watchmann]

Unless there are extenuating circumstances or a particular situation it is always better to pay off your debt rather than coninue paying interest on it.  Don't let the FICO score game rule your financial life.  It is secondary to getting out of debt.

[Anonymous]

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@Anonymous wrote:

Hey yall,

I have two credit cards and both are maxed out($3200,$1800) I now have the money to pay off the the cards.  My question is, is it better to pay the full balance off the cards or pay half then half later?  I want to gain max points toward my score.  I need to buy a car

Thanks!

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You will gain points when your utilization decreases.  It's just that simple.  The easy part is paying off the cards.  The hard is not running the cards back up which will decrease your scores again.   Hopefully you didn't borrow the money to pay the cards off.  

[haulingthescoreup]

This question might have arisen from using the myFICO score simulators, which show a higher score by paying off debt over time than all at once.

That's not what's actually happening: what the sims are saying is that if you pay off your debt AND KEEP IT OFF for x number of months, your score will be so-and-so. (Maybe.)

But if you PIF'd (paid in full) today, and then kept your balances near $0 for that period of time, you'd (maybe) wind up with that projected score.

I wish they'd clarify that on the sims, because it confuses the heck out of a lot of people.

Anyway, to boil it down, the others are right: pay it all off now, and then keep it off.

[Anonymous]

So i paid all my credit cards and removed 1 90 day miss payment mark from my credit report.  That 90 day miss payment was a installment loan and when they removed that miss payment mark they also removed the account itself. Is that supoose to be right? My other question is if im plan on buying the same car i had a loan out for 2 years ago ($46,500 car) what should i expect my rates should be with a credit score of 683, $15,000 down payment.(i plan on buying next month) Will my score go up if i apply for a brandsmart card?

Thanks!