I would assume they mean any CCs you have. I am still fighting my way through the journey myself so take it for what its worth, I'd pay down cards to less than 10% then work on loans and maybe get the cards AZEO eventually. Or whatever order you need because the loans aren't hurting you
@disney2 wrote:I have some confusion. I am working on paying down my cards, mostly because I think I need to pay those down before paying off any loans, and I have a question. Sometimes I see notes like balances on bank cards too high. What constitutes a bank card? To help my score, do I pay those down first or do I pay off the other cards? I plan to pay them to AZEO but need to know what to pay first to help my score.
I'm thinking you should choose based upon interest rate; the credit instruments, regardless of whether they are a loan or a credit card, with the highest rates should be paid down/off first, and then work your way down the list. While I don't necessarily agree with the whole AZEO thing, I do agree with the notion of carrying some small balances, say 2% or less of limit as well as having a loan under 9% of the limit, as a means if improving one's scores.
From my understanding a bank card is a debit or credit card issued from a specific bank. Unlike larger issuers (Citi, Chase, Amex, Etc), they are usually issued against a depository account, however they can also be a "bank card" if it's a visa/mastercard that is issued from a specific (usually local) bank.
In many cases they are used interchangeably and as far as your credit report goes, if it is reporting a balance you can treat it as you would any other credit card.
Overall, I would pay whichever revolver has the highest interest the most agressively.
@SDMarik wrote:From my understanding a bank card is a debit or credit card issued from a specific bank.
I would argue a debit card is not a bank card; debit cards have no credit limits per-se and are not reported to any credit bureau.
@disney2 wrote:I have some confusion. I am working on paying down my cards, mostly because I think I need to pay those down before paying off any loans, and I have a question. Sometimes I see notes like balances on bank cards too high. What constitutes a bank card? To help my score, do I pay those down first or do I pay off the other cards? I plan to pay them to AZEO but need to know what to pay first to help my score.
For purposes of FICO scoring and negative reason statements, a bankcard is a bank- or CU-issued credit card that runs on a major payment network like Visa, MC, Disco, or Amex. This is contrasted with store cards, which can only be used at specific retailers. I don't know that balances on bankcards are penalized any differently than those on store cards by the FICO algos, but, as has been said upthread, I would put finances above FICOs and pay down your balances in the way that makes the most financial sense to you (e.g. smallest balance to largest balance, or highest interest to lowest interest).
Also, I just wanted to add that what @Anonymous says about bankcards and AZEO is essentially correct, but almost all store cards and CU issued credit cards will report to all three bureaus. The reason that a bankcard is recommended for AZEO is that FICO algos penalize you for not having a reported balance on at least one bankcard. Storecards aren't recommended b/c they aren't bankcards. CU issued credit cards should work, but they aren't always coded correctly so it's better blanket advice to use a bank-issued credit card.
@Anonymous, is there anything helpful you could add?
@FinStar wrote:
@Horseshoez wrote:
@SDMarik wrote:From my understanding a bank card is a debit or credit card issued from a specific bank.
I would argue a debit card is not a bank card; debit cards have no credit limits per-se and are not reported to any credit bureau.
From a credit bureau reporting standpoint and for the purpose of this thread, sure. Which is what the OP may be referencing with regard to account balances.
But, technically speaking, a debit card is a bank card (as issued with the respective network). It may not report to the CRAs, but depending on the FI, they have daily ATM and/or transaction limits, for example.
My comments were meant to be within the context of this thread and what the OP was asking.