Not sure where to go from here

[derboesekoenig]

I got my FICO from Amex website. Current score is 533. When should I apply for CLI? I did a simulation for 6 months, and I inputted eliminating all CC debt besides $2, and keep all current/pay on time, it would hypothetically reach 677. However, the 533 is before I made all the moves recently of paying everything off/down, so I guess I will wait for the August update and see where it is then

[derboesekoenig]

My transunion score went up to 549 today. So on July 24 it was 504. And it still shows the 21.8k+ i owed on an installment loan (which I just paid off), the 2 student loan debts that were late that I also paid off, and 2 credit cards still reading 100% util. 

I'll let you guys know when everything is updated, what it goes up to. Thanks for all the help so far

[derboesekoenig]

What are the recommendations for the myfedloan? Should I keep it going for 6 more months? A year? When would be best to pay it off?

[Anonymous]

Do you have any other loans going? An installment loan helps optimize scoring. If you have other loans, then go ahead and pay it off. If not, I would keep it as it’ll help you increase your score as your account ages and you continue to make your payments as required.

[Anonymous]

In post #16 I walked you through how your different loan payoffs thus far had affected your installment utilization and showed you how to compute it with many examples.

I also explained that a lower IU is better in the FICO 8 model and that a person achieves maximum scoring benefit from IU when it is under 8.99%.

That should give you the tools you need to make choices about what will serve you best.

[derboesekoenig]

Ok so I will pay them down to 8.99%, but in the next 5-6 months. After it reaches 8.99%, I will pay whatever the minimum payments are until paid off. I *think* this is a good option for me. In the meantime, I will continue to pay off all CC balances in full, but leave a small balance on one card. 

Is it ok to keep the current cards in service by using once per month or does it need to be more frequent? Just curious, as I forget to use some of them from time to time.

Also curious when is an appropriate time to apply for CLI, and for which cards?

Thanks!

[Anonymous]

For cards you don't use but want to keep alive, 1 small charge every 6 months will suffice in most if not all cases.

[derboesekoenig]

Awesome, thank you!

[derboesekoenig]

Ok since I paid off the only installment loan I had, I need another one. I'm going to get a NFCU SSL, but had questions about which length/term will benefit me most. From my understanding, I can go for a 7 year SSL at $25k, share rate + 3%, or 5 year with $3k at share rate + 2%. It will be immediately paid down to 8.9%. Should I just go with the 5 year? I'll move funds that I plan on using to savings account, and call them next monday. 

And since I can do CLI on odd months for NFCU CCs (September), should I attempt only one card at a time, or should I do all 3 at once? I will request on September 7 so that no HP will be incurred.

Thanks for all your help guys

For reference:

Opened NFCU cards

Visa Platinum: 11 Feb 18, $6400

Visa Go Rewards: 1 Dec 16, $7900

NFCU Amex: 22 Oct 17, $20,000

I have zero CLIs on any of them thus far

[Anonymous]

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@derboesekoenig wrote:

Ok since I paid off the only installment loan I had, I need another one. I'm going to get a NFCU SSL, but had questions about which length/term will benefit me most. From my understanding, I can go for a 7 year SSL at $25k, share rate + 3%, or 5 year with $3k at share rate + 2%. It will be immediately paid down to 8.9%. Should I just go with the 5 year?

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How likely is it that you will have no other loans five years from now?  (Car loan, car lease, mortgage, student loan, etc.)  If you think it is likely you will still have no other loans, and you have 25k in spare cash that you don't mind tying up for a month, then the 7 year is an option.  Otherwise the five is the better choice.

I don't know anything about strategies for Navy CLIs.  Do be aware that a CLI will not help your score at all, though it won't hurt it either (aside from the hard pull).