car loan vs. credit debt

[Anonymous]

 I was wondering if anyone here could help with some advice. I have 5 cc's with a total of about 18,000 balance, I sold my jeep for 18,000 so I could pay all of the cards off but then when I buy another vehicle I will be taking on a 15,000 loan, my debt to ratio I guess would be about the same but I would have 5 cc's paid down and assuming another vehicle loan , I already have a car loan for 7500.00 so....my question is?  If my cc's are all payed down but I am assuming a new auto loan, will it still raise my credit?,  which right now is tu 739, ex 700, eq 678

[Anonymous]

Paying revolving debt off will definitely increase your FICO... The Revovling debt to available balance is weighted the heaviest when calculating score... About one third.

Installment debt is weighted from an entirely defferent prospective.

Take Care.

Rob 

[Anonymous]

have you considered selling the car for 18,000, paying down 15,000 of your debt, and getting a loan for a less expensive car?

[Anonymous]

  Thanks for the replys, that is exactly what I thought, that the installment payments on a vehicle were weighted differently and that paying down the revolving balances was a smarter thing to do...and Rifleman, that is what I'm doing, using several grand as a down payment on a less expensive car, 2005 grand prix I found for 14,000 w/ 8,000 miles by the way, which they would give me at 7.0% interest, while some of the cards I'm paying off which started at 6 percent for some reason just all of the sudden went up to like 19%, this happened to my girlfriend too, these companies like wamu will just raise the rate for no apparent reason. thanks for the advice. Mike

[Anonymous]

Exactly, pay off the revolving debt (credit cards) first.  And if you have a lot of credit card debt, it's not looked upon highly from lenders.  And paying off those credit cards should also help your score since your utilization will decrease dramatically.

[haulingthescoreup]

About the CC rates suddenly jumping --were you late on even one card? There's an evil practice called "universal default" that allows credit card company B (and C, and D, and E - Q) to raise the APR if credit card company A did so. So if you messed up on one card, the vultures immediately fly in and start pecking.

Some companies will also rate-jack you if they see that you have maxed out some of your cards. Fun, huh?

[Anonymous]

Capital One upped my rates a few months ago for no apparent reason...  It was at 12.9% APR and now it's at 18.95%.  While it's frustrating, especially when my scores have constantly increased, it's written in their agreement that you sign that the APR may increase at any time for any reason...

[haulingthescoreup]

I fortunately stumbled years ago upon a bank/ CCC that is very above-board in their dealings with me. I've read so many horror stories on these boards that I have decided that if I do pick up another card or two in the future, it will be strictly on the basis of how well the issuing company treats its customers. Points and cashbacks, APR's and credit limits aren't going to be the primary determining factor, but whether the actual bank thinks that I am something more than a cash cow to be milked. This is especially so with store cards, which all use other banks to do the actual work. (Except Target, that is.) Store cards seem especially hellish if anything ever gets screwed up.

[Anonymous]

  When you say late on a payment, I've never been more than 30 days where derogitive info was posted against me but I'm frequently late by a week or so , does this affect your score?, I thought only negative reporting as derogatory status affected your score

[haulingthescoreup]

Remember that we're talking about pleasing two different entities: FICO and your CCC. You're right, FICO scores will only be affected if your CCC reports a late to the CRA's, and usually the CCC doesn't do that until you've missed the second due date. But you can bet that your CCC is keeping track of your payment history, and if you frequently miss the due date, it's going to figure out that you've got problems, and up goes your rate.

Same thing if you GW a baddie off your credit report: the CCC might be willing to stop reporting it to the CRA's, but it knows that it happened, and the baddie will be factored in when you ask for lower rates, higher CL, or an additional card.

Since your other CCC's periodically soft your report, they will see if you have lates. I think that they also see your payment history and APR's, although maybe that's just on hards. Someone once posted that lenders get reports that are WAY more detailed than what we can see as consumers.