Hi there! I'm curious if this strategy makes sense... I do not have any personal loans at the moment. I have paid off all my credit cards except one, which is sitting at $17k out of a $18k balance, so almost maxed out. I was thinking about taking out a personal loan of $15,000 and paying off that one credit card (I can pay off the remaining $2k over the next few months). This would add a personal loan to my credit-type mix and lower my credit utilization drastically - of course, I'd still have a loan sitting out there with $15k on it. My scores are sitting around 700 right now and I know paying off my credit cards would raise it close to 730-740ish, but I worry what would happen when I add the loan in the mix.
Also, I'm wanting to apply for a mortgage possibly in 4-5 months, possibly sooner. That's probably the only thing preventing me from going this route. I can probably get my one cc down to $13,000 out of $18,000 in that timeframe but my score will remain in the lower 700s most likely. Thoughts??
Starting Score (01/31): EQ: 609; TU: 641 EXP: 641
Stuck between a rock and a hard place. Its best to not get new accounts a year before applying for a mortgage. On the other side the interest saved would be nice with the loan. Thats is if you werent looking to purchase a home. If you have any money saved that could bring down the util on that card. That would help more than a new account hiting your file. At least half or 48% and not just 2000. The higher your score may put you into a smaller down payment on the house bracket.
Frankly if you are going to app for a mortgage I would not be adding any new accounts at this time. A mortgage will satisfy the no installment loan part of Fico. If you want to move to a PL to save on interest I would do so after the mortgage app.
