My AA chances

[Anonymous]

So I have a huuuuugeeeeee expense I just had to pay for. Expense was about 40k. Took out a 20k personal loan and put the rest on some credit cards than moved it over to a few zero balance bt offers. My income is about 60k, my dti will be about 29% with everything reporting which includes an auto lease. The debt can be repaid in 2 yrs tops. I have no mortgage so basically I have the cash to throw at the debt but I'm wondering if this will spook every creditor? Ficos in low 700s perfect payment history, even with the debt 14% utilization, 4 year history with infinity 24 lol many paid in full personal loans. Entire debt on report 50k with lease 

[Anonymous]

Absolutely no problem paying a little more than minimum payments might I add 

[FinStar]

It would largely depend on how this will impact your CRs, individual/overall utilization, score deterioration (if any) and any lenders that are known to be fairly sensitive to significant fluctuations associated with sudden debt acceleration.  Who are your lenders and how are these balances spread out?

[Anonymous]

so I have the following:

penfed 3 credit cards 15k out of 20k used highest individual utilization 86% on 2 of them 0% bits

2 discover cards

sychrony Amazon and lowes

Bmo platinum

4 BBVA cards and 1 with a 5550 bt 0% about 80% utilization on one card rest pif
2 American Express cards 1k limit each lowest 

1 Langley card 

the build card But kinda predatory but oldest account 

Wells Fargo tempurpedic just pif carried bal for 2 years recently pif

mazda financial 14k debt auto lease 1 year old and bow under 10k

loads of inquiries and new accounts but still getting approvals and cli top utilization will be about 14% have over 100k in credit, I'm just concerned about the debt total being almost my income but like I said no mortgage and dti will be under 30%, just one of those life things came up and had to spike debt quickly but I'm hoping these facts won't spook everyone especially since I'm not In a position where I cant pay everything each month easily thx for the feedback

[Anonymous]

And the rest of the 20k on a personal loan 450 a month 

[SouthJamaica]

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@Anonymous wrote:

So I have a huuuuugeeeeee expense I just had to pay for. Expense was about 40k. Took out a 20k personal loan and put the rest on some credit cards than moved it over to a few zero balance bt offers. My income is about 60k, my dti will be about 29% with everything reporting which includes an auto lease. The debt can be repaid in 2 yrs tops. I have no mortgage so basically I have the cash to throw at the debt but I'm wondering if this will spook every creditor? Ficos in low 700s perfect payment history, even with the debt 14% utilization, 4 year history with infinity 24 lol many paid in full personal loans. Entire debt on report 50k with lease 

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It could indeed "spook" creditors so pay it down as fast as possible.

[Anonymous]

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@Anonymous wrote:

Absolutely no problem paying a little more than minimum payments might I add 

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What do you mean by "little more than minimum payments"?  This statement conflicts with your other comments about throwing money at the debt and paying it off in 2 years. A little more than minimum payments doesn't support either of those statements. 

Furthermore, paying only the minimums or just barely above minimum payments is a good way to push those lenders that may take AA to do so. Few lenders want to see a huge debt incurred with little progress at paying it off. 

[PackAttack07]

I think you should be fine as long as you do not increase balances on other accounts. Don't let cards you PIF report a big balance even if you're about to pay it off next month - pay it ahead of time. And absolutely stop applying for new credit that is probably what will trigger AA at this point.

The reason is "bust-out" fraud. There are bust-out risk scores and you will absolutely be on the radar given you not only raised your balances but opened that personal loan. The next month or two will be critical; pay your balances before the statement end date so they report $0 and banks that are nervous don't think you're running everything up to zero then will disappear (bust-out fraud).

The real question in my opinion (assuming you stop applying for cards and don't let big balances get reported) is at what point can you resume credit seeking activites. Of course, rule #1 is pay down your new massive balances as much as possible. But if you're doing that 6 months from now can you safely apply for a new card or two? I'd say probably, depending on the issuer. But if you have 5 new inquiries show up over the next 3 months you are going to be 100/100 bust-out risk and the AA cascade could start.

You probably know this but be careful with 0% intro offers and balance transfers... you can get lulled into a sense of complacency and not pay down those debts, only to find yourself in the same situation 18 months from now. If you responsibly pay down that new debt and are aware of what data points banks are seeing (as it seems you are by your question), I think you'll be fine.

[Anonymous]

@Anonymous so it would be double the minimum payments on the cards, sorry to sound contradictory but for example  the minimum on a 5500 Bal is $110 so paying double that didn't seem like much more lol so my plan is to pay the minimum on the personal loan and  pay about 650 a month towards the cards. I get a decent tax return each year so I I'm just gonna throw the whole thing at the card debt in early 2023  then start throwing that money at the loan with me putting my return money towards the loan in 2024

[Anonymous]

Ya that was my thoughts about the bust out fraud def don't want that. That's what I've been doing for awhile like I pay before the statement prints for most cards, I'm assuming the bust out fraud thinking would go away though after a few months of seeing double the minimum payments and payments on the loan, Thoughts?