Upstart personal loan $7500 outstanding 33% APR - worth getting a balance transfer?

[leo187um]

My oldest opened credit card account is 1 year; trying to position myself the best I can to apply for Chase or Amex business credit cards with high limits in 6-9 months time. My FICO is 730+ across the three bureaus but my profile i young and have had a bunch of inquiries over the past year.

I have one personal loan outstanding with Upstart; is it a good idea to pay this off before applying?

I've been thinking about using my BoA card (6000 limit) to get a $2000 balance transfer for three consecutive months; 3% fee and 17% APR but still better than the 33% APR i pay on the upstart loan.

Would appreciate your suggestions as to what the best course of action for me to take given my goal of applying for a new credit card in 6-9 months?

Thank you.  

[SlideOrInsert]

it is a good idea to pay off upstart because it is almost criminal.

33/100/12 * 7500 = $206.25 monthly in interest.

vs.

33/100/12 * (7500-5728) = $48.73 monthly interest.

17/100/12 * (5728*1.03) = $83.58 monthly in interest.

just do the balance transfer in one shot. 5728*1.03 = 5900 balance of 6000 limit. sure you "max" the card out, but that 33% is ruining progress. pay off the upstart remaining balance urgently.

17% is not great either, in your case I would be looking for 0% balance transfer cards. not sure why you are seeking business cards.

[MileHigh96]

---

@leo187um wrote:

My oldest opened credit card account is 1 year; trying to position myself the best I can to apply for Chase or Amex business credit cards with high limits in 6-9 months time. My FICO is 730+ across the three bureaus but my profile i young and have had a bunch of inquiries over the past year.

I have one personal loan outstanding with Upstart; is it a good idea to pay this off before applying?

I've been thinking about using my BoA card (6000 limit) to get a $2000 balance transfer for three consecutive months; 3% fee and 17% APR but still better than the 33% APR i pay on the upstart loan.

Would appreciate your suggestions as to what the best course of action for me to take given my goal of applying for a new credit card in 6-9 months?

Thank you.  

---

Another option would be to refinance it.  I had the same issue with Lending Club.  I had a personal loan with them last year and the interest rate was in the low 30% range.  I looked around about refinancing it and I went with Upgrade and I was able to get a 12.53% APR with them versus that 30-something percent that I got with Lending Club.

[leo187um]

I have the money to pay it back now but wanted to see whether it makes sense to use the Bank of America card as i can transfer the balance without a hard inquiry. Using the full balance would kill my utilization and my credit score will drop.

I want business cards as they have high limits and don't affect your personal credit score (unless I default). 

[RSX]

if you have the money to pay it off now, pay it down to 8%

wait for it to report - then app for the cards you want

once you get the cards, finish paying off the loan entirely

[leo187um]

Curious as to why only pay down until 8% rather than pay off the full balance? I need to garden anyways so it might be a smart move to use the BoA card transfer after my 0pct APR period ends in March 2023.

[SlideOrInsert]

---

@leo187um wrote:

I have the money to pay it back now but wanted to see whether it makes sense to use the Bank of America card as i can transfer the balance without a hard inquiry. Using the full balance would kill my utilization and my credit score will drop.

I want business cards as they have high limits and don't affect your personal credit score (unless I default). 

---

"pay it back now" then and save yourself so much money in interest.

to build a relationship, deposit that monthly money saved into a deposit account for 6-9 months with whatever bank you might seek out a business card with.

finances > fico.

[leo187um]

I need time to garden and wait for past inquiries to roll off so don't see a rush to use 7.5k of capital to pay it off.. just thought it would be better to deposit more cash into chase and Amex and pay off the balance over a couple months..

It's not like I'm struggling with debt or anything.. 

[RSX]

the reason to drop it to 8% - then applying - then paying it fully off is because

1. if it is your only loan, you will take a hit for not having a loan in your credit mix

2. loans give a good point boost when they drop below 9%

so my plan above is to help you boost your score for 1-2 months - get your apps done while your score is higher (at the cost of 2 months interest) 

then pay it off!

[RSX]

i call having $7500 at 33% struggling with debt......

when you pay it off, you will be able to build it back up fairly quickly, since you won't be wasting that @$200+ in interest loss

pay it off - then use the monthly amount you save on loan payments to build up your saving accts