Pay all a little or pay down lowest balances??

[Anonymous]

Hey all

 let's say you had 27 rehabbed student loans in various amounts from the fun $900s to the sobering thousands. They are in a very minimum IDR payment plan that barely scratches the surface of the loan balances.  Let's further say that you want to maximize the way Fico treats loans by optimizing your payment strategy. Let's agree that you can't pay any one off totally, nor make significant headway at least in the near future. 

what would your payoff strategy be?

1. Do a snowball pay plan, where lowest gets paid off first?

 
2. Pay down highest balances first

 3. Just keep spreading out minimum payments until I'm dead

 I'm thinking that I'd like to add some extra padding to my loan payment each month, but I'd like to be strategic about it. Is it even worth it to try? Thanks!!

[Anonymous]

Option 3, unless you can pay them all off but that seems unlikely?

FICO loan utilization scoring uses aggregate utilization so it doesn't matter if one loan is paid down if the other large balance ones are still high

[calyx]

In addition to FICO using aggregate utilization of installments, it's also of very little impact.
You can maximize your impact by paying down to <9% and keeping it that way & open as long as possible if you have no other installment loans (like auto or homeowners).   If you have other open installment loans, it really won't matter all that much how you pay it down and figuring out the 9% util with multiple loans can be a PITA.

I'm a Finances over FICO person, so I would use the avalanche method, and then just nurse out the last loan as long as you can.
I have a single loan, so I'm paying it down like it's on fire, which (usually, let's not talk about the CARES act mucking everything up for me).  I can have it paid off in 2 years, which is 8 years early... so I'll pay it down to ~$200 and just let it ride until I start getting close to the end of my loan terms so I don't default.