Which card to pay off for greatest score boost?

[avv7c0]

So, I know the true answer on this will vary depending on the rest of the report. But in general, here's my question.

I owe:

$2,800 on AMEX with $40,000 limit.
$4,500 on Venture with a $29,000 limit
$4,750 on Chase with a $13,500 limit

I'm pulling a new car loan in the next two weeks. AMEX has already posted this month, so paying it off will have no effect when lenders pull my scores until next month.

I have $5,000 available to apply to one of these. The rest are business expenses that won't be reimbursed until the end of the month. So I have to go into this application with at least two cards reporting balances. Which is the best solution:

A) Pay nothing, keep cash in bank because they check that when applying for a loan.
B) Pay Venture, showing $29,000 available. Chase will show 35% utilization.
C) Pay Chase, showing $13,500 available. Venture will show 16% utilization.

And no, I can't wait on the car loan. Its a special order car that will be sold if I don't claim it. I wasn't expecting to have to wait this long to have my business expenses reimbursed, so that's what's gotten me into this pickle.

My current score is right about 800 here on the site.

[Anonymous]

Hey there.  Paying down $5000 in your CC debt will bring you from 15% utilization to 9% utilization (8.5% rounded up) so with your aggregate utilization crossing into the best threshold you're going to see a nice score increase which is a great thing prior to applying for this loan.

I'd personally split your $5000 between the Venture and the Chase.  Pay $2100-$2200 toward the Venture to take it's utilization down to below 9%, putting that card in the ideal range.  Put the remaining $2800-$2900 toward the Chase card which would bring that one to somewhere around 14% utilization, which is in the second best range but wouldn't result in a score ding with aggregate utilization at under 9%.

[avv7c0]

Thanks! So you think overall utilization is a more important score factor than number of cards with balances?

[SouthJamaica]

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@avv7c0 wrote:
So, I know the true answer on this will vary depending on the rest of the report. But in general, here's my question.

I owe:

$2,800 on AMEX with $40,000 limit.
$4,500 on Venture with a $29,000 limit
$4,750 on Chase with a $13,500 limit

I'm pulling a new car loan in the next two weeks. AMEX has already posted this month, so paying it off will have no effect when lenders pull my scores until next month.

I have $5,000 available to apply to one of these. The rest are business expenses that won't be reimbursed until the end of the month. So I have to go into this application with at least two cards reporting balances. Which is the best solution:

A) Pay nothing, keep cash in bank because they check that when applying for a loan.
B) Pay Venture, showing $29,000 available. Chase will show 35% utilization.
C) Pay Chase, showing $13,500 available. Venture will show 16% utilization.

And no, I can't wait on the car loan. Its a special order car that will be sold if I don't claim it. I wasn't expecting to have to wait this long to have my business expenses reimbursed, so that's what's gotten me into this pickle.

My current score is right about 800 here on the site.

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No brainer. Pay Chase, because when you pay Chase down to zero it will usually report almost immediately to the bureaus.

[Anonymous]

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@avv7c0 wrote:
Thanks! So you think overall utilization is a more important score factor than number of cards with balances?

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It's not my opinion, it's a fact that aggregate utilization is more important to FICO scoring than number of cards with balances.  Some people (myself included) have reported no scoring ding at all for 50%-100% of cards reporting balances, so long as all of them are small balances.

[SouthJamaica]

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@Anonymous wrote:

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@avv7c0 wrote:
Thanks! So you think overall utilization is a more important score factor than number of cards with balances?

---

It's not my opinion, it's a fact that aggregate utilization is more important to FICO scoring than number of cards with balances.  Some people (myself included) have reported no scoring ding at all for 50%-100% of cards reporting balances, so long as all of them are small balances.

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That is probably true for FICO 8, but I'm not sure it runs across all scoring models. I'm no expert, but I think the older scoring models, including the mortgage models,  do have sensitivity to the number of cards with balances.

In my EX report from yesterday,  FICO 2 complained about the number of accounts with balances, a subject on which FICO 8 was silent.

[Anonymous]

That may be the case SJ that different models have different views of number of cards with balances, but I would think that aggregate utilization is still King to scoring with respect to the utilization sector regardless of scoring model.