To Pay Off or Not To Pay Off

CreditJunkie917 · ‎01-02-2014

So I have been thinking about this all day today. I have NFCU LOC for $15K. Now I could eliminate all of my SL, auto loan, and CC debt utilizing the LOC but then would be on the hook with paying back. Is this something you would suggest or should I keep the TLs open and continuing paying on the installments? With the new accounts i've added, doing this would would put the LOC at 80% UTI, with overall UTI at 20%. Thoughts??

Amex PRG(NPSL), Amex BCE($5K), Amex Hilton($1K), NavCheck ($15K), NFCU CR Siggy($20K), USAA Amex($7K), USAA World MC($7K), CSP($2.3K), Chase Marriott($1.8K), Care Credit($2.5K), Cap1 QS($3.5K), VS($500), Cap1 Secure($200) Starting Scores(Jan 2013): FICO EQ: 643, TU: 552, EX: 567 Current Scores(Sept. 2016): FICO EQ: 672, TU: 703(?), EX: 682 In the Garden FOR-EV-ER!!!!! Cards and goals achieved! Let's grow and mature these babies!!!

Anonymous · ‎01-02-2014

One issue here is moving back and forth between revolving and installment debt. As a general rule, the former hurts you more than the latter.

If the LOC reports as revolving, and you move installment debt to it, then that might be an issue, in particular with 80% utilization.

You haven't said what the relative APRs are for the various options.

CreditJunkie917 · ‎01-02-2014

auto loan is 5.29%, CC is 15.15%, LOC is 15.99%. SL #1 is 2.5%, SL #2 is 5%. And I see your point about moving revolving credit to satisfy installment debt.

Amex PRG(NPSL), Amex BCE($5K), Amex Hilton($1K), NavCheck ($15K), NFCU CR Siggy($20K), USAA Amex($7K), USAA World MC($7K), CSP($2.3K), Chase Marriott($1.8K), Care Credit($2.5K), Cap1 QS($3.5K), VS($500), Cap1 Secure($200) Starting Scores(Jan 2013): FICO EQ: 643, TU: 552, EX: 567 Current Scores(Sept. 2016): FICO EQ: 672, TU: 703(?), EX: 682 In the Garden FOR-EV-ER!!!!! Cards and goals achieved! Let's grow and mature these babies!!!

Anonymous · ‎01-02-2014

I don't see the point of moving low-APR installment to high-APR revolving.

If you have revolving debt with a certain APR, and move it to another revolving (like LOC) with a similar APR and a higher CL, then that might be a win, because it would help per-CC utilization issues.

You're unlikely to be able to get another installment loan with an APR low enough to close out your current low-APR installment loans.

NFCU has various BT deals every year. Would any of those help you?