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Hello,
So my scores are sitting at 581, 581 and 601. I am just wanting to make sure my plan of attack looks correct. I really want to have a relationship with Chase and Capitol one. I have about 2000 a month to put towards paying things down. Should i maybe move chase card up? I do not want to lose high limit on that card.
My plan is to pay off in this order
Janurary: Discover pay off completely
Feburary: Pay off one barclay
March: Pay off other barclay
April: 2000 to Amex
May: 2000 to Disney Chase
June: 2000 to Amex
July 2000 to Disney Chase
August: 400 to Disney Chase
Below are my cards and their limits/Balances
Card Balance CL NOTES
CAP1 0 $500
Chase-dsny 4400 5000
Amex EvD 4000 $4500
ChsFreedom 0 $500
Barclay AR 2400 2800
Discover 1900 2000
CU LOC 0 500
Barclay 1800 2000
Indigo 0 300 (Want to cancel this, but helps with utilization for now)
Personally, I think you should pay at least minimum payments on all cards, then attack top 2 or 3 with the highest interest (interest rate multiple by the balance).
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Welcome, @Anonymous. ![]()
Your first priority should be to hopefully avoid adverse action, i.e. credit limit decreases and balance chasing. Start by paying each card down to 67% of its limit. That can be accomplished in your second month of payments with money to spare. Once you've done that, bring each card down to 47% of its limit.
The thresholds you want to cross are actually 68.9% and 48.9%. Paying to 67% and 47% will prevent the next month's interest charge from bumping you back over the threshold.
After all cards are at 47%, you can pay down as you like, e.g. highest interest first, snowballing small balances first, or aiming for a (slightly) quicker score gain.
@HeavenOhio wrote:Welcome, @Anonymous.
Your first priority should be to hopefully avoid adverse action, i.e. credit limit decreases and balance chasing. Start by paying each card down to 67% of its limit. That can be accomplished in your second month of payments with money to spare. Once you've done that, bring each card down to 47% of its limit.
The thresholds you want to cross are actually 68.9% and 48.9%. Paying to 67% and 47% will prevent the next month's interest charge from bumping you back over the threshold.
After all cards are at 47%, you can pay down as you like, e.g. highest interest first, snowballing small balances first, or aiming for a (slightly) quicker score gain.
These thresholds are for FICO scoring, and while that might pay a large part in issuers initiating AA, it's possible that other factors are much more critical. So I might still prioritize interest reduction over paying off to thresholds.
+1 to this. Some people are concerned about the amount of interest they are paying, but if you are looking primarily to bump up your FICO scores, then I would follow this plan. Make sure you make the minimum on all cards, but attack those that have the highest UTL first (Disco, Chase Disney, Amex, & Barclays). As stated by HeavenOhio, get them all below 68.9%, then 48.9% then below 28.9%, and finally all under 8.9%.
I would pay $400 to each of the 5 accounts first, getting the UTL down. That should give you a score bump. Next month do the same, giving you another score bump. Third month pay one off & divide the remaining funds among the four other accounts. Wash, rinse & repeat for the next four accounts. You'll pay them all off in the same time frame as your previous plan, but you'll be getting the UTL down quicker, hopefully before they start BCing you. GL!
Ok, so I actually tossed these balances into my budget spreadsheet to see what a payoff plan would look like giving you FICO bumps along the way.This does NOT calculate any interest, but you will be within ballpark of these figures, and you will be showing consistent pay history rather than one big payment to each account.
Let’s say you are making one payment per account per month, starting on Jan 25, 2019 (or whatever day your pay period is)
01/25/19 Balance Limit Payment
Chase-dsny 4400 5000 400
Amex EvD 4000 4500 400
Barclay AR 2400 2800 400
Discover 1900 2000 400
Barclay 1800 2000 400
02/22/19 Balance Limit Payment
Chase-dsny 4000 5000 400
Amex EvD 3600 4500 400
Barclay AR 2000 2800 400
Discover 1500 2000 400
Barclay 1400 2000 400
03/22/19 Balance Limit Payment
Chase-dsny 3600 5000 400
Amex EvD 3200 4500 400
Barclay AR 1600 2800 400
Discover 1100 2000 400
Barclay 1000 2000 400
04/19/19 Balance Limit Payment
Chase-dsny 3200 5000 350
Amex EvD 2800 4500 350
Barclay AR 1200 2800 350
Discover 700 2000 350
Barclay 600 2000 600
05/17/19 Balance Limit Payment
Chase-dsny 2850 5000 550
Amex EvD 2450 4500 550
Barclay AR 850 2800 550
Discover 350 2000 350
Barclay 0 2000 -
06/14/19 Balance Limit Payment
Chase-dsny 2300 5000 850
Amex EvD 1900 4500 850
Barclay AR 300 2800 300
Discover 0 2000 -
Barclay 0 2000 -
07/12/19 Balance Limit Payment
Chase-dsny 1450 5000 950
Amex EvD 1050 4500 1050
Barclay AR 0 2800 -
Discover 0 2000 -
Barclay 0 2000 -
08/09/19 Balance Limit Payment
Chase-dsny 500 5000 500
Amex EvD 0 4500 -
Barclay AR 0 2800 -
Discover 0 2000 -
Barclay 0 2000 -
Debt free by Sept '19!
@Anonymous wrote:
@HeavenOhio wrote:Welcome, @Anonymous.
Your first priority should be to hopefully avoid adverse action, i.e. credit limit decreases and balance chasing. Start by paying each card down to 67% of its limit. That can be accomplished in your second month of payments with money to spare. Once you've done that, bring each card down to 47% of its limit.
The thresholds you want to cross are actually 68.9% and 48.9%. Paying to 67% and 47% will prevent the next month's interest charge from bumping you back over the threshold.
After all cards are at 47%, you can pay down as you like, e.g. highest interest first, snowballing small balances first, or aiming for a (slightly) quicker score gain.
These thresholds are for FICO scoring, and while that might pay a large part in issuers initiating AA, it's possible that other factors are much more critical. So I might still prioritize interest reduction over paying off to thresholds.
If scoring were the prime objective, I'd have suggested getting to 29% before moving to high interest first or another method. If it turns out that the OP is balance chased anyway, I'd simply revert to getting the balances down the fastest way possible, which would be to go with the highest interest first.
If the situation were more daunting, I'd have suggested getting to 87% first (which is still an option). But in this case, the OP can get to 67% pretty quickly. Still, high interest first can be incorporated into the earlier payments by getting all cards to 67% (high interest first), then 47% (high interest first).
@Anonymous wrote:
Seems to me, as long as op will be debt free by Sept, how FICO score varies before September probably is not that important in the end.
Unless he wants to app before Sept I guess.
The danger, though, lies in keeping the high balances on the other cards if he only pays one off a month, in addition to not really helping his payment history portion of his score. If for any reason the poop hits the fan, & his plan of paying one off a month derails, he will still have several cards with very high UTL ratios that could be closed or balance chased if times get rough & a payment is missed. It's the OP's choice in the end, but I personally think getting all accounts down is a safer strategy and has a better chance of keeping all his cards open. Just my 2 cents...