Advice Needed: Better to Pay Off One Card or Use the Funds to Further Pay Down Other Card?

[jrands]

Hi everyone. I have two cards. One is a credit card while the other is a store card. Here are the details for each:

CC: $10,000/$22,500.

Store Card: $450/$2,700

What would be the most impactful for my credit score? Would it be better if I paid off the store card, or use the funds to instead further pay down the CC? The store card has a monthly min payment of $25 while the CC has a monthly payment of $200. For the latter, I already currently pay it down about $900 a month. So if I opt not to pay off the store card, I would put about $1,325 down for the next CC payment. TIA

[Jnbmom]

Pay off the store card, sock drawer it and don't use .

Then pay as much as you can on the other, you need to get that utilization down .

[jrands]

Thanks! Figured it be better to pay off the store card. Yes, trying to reduce the credit utilization and overall DTI as fast as I reasonably can since I'm also looking to buy a home relatively soon (within the next year or so).

For the CC, I've been going back and forth whether to put in a one-time payment of $5,000 to cut it in half, or whether it'd be better to keep the funds considering everything going on with Covid, and just continue to pay the $900 a month. The monthly min is currently $200, so already putting in an extra $700.

[SouthJamaica]

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@jrands wrote:

Hi everyone. I have two cards. One is a credit card while the other is a store card. Here are the details for each:

CC: $10,000/$22,500.

Store Card: $450/$2,700

What would be the most impactful for my credit score? Would it be better if I paid off the store card, or use the funds to instead further pay down the CC? The store card has a monthly min payment of $25 while the CC has a monthly payment of $200. For the latter, I already currently pay it down about $900 a month. So if I opt not to pay off the store card, I would put about $1,325 down for the next CC payment. TIA

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Best to pay off the store card. Let it report a zero statement balance each month.

[SouthJamaica]

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@jrands wrote:

Thanks! Figured it be better to pay off the store card. Yes, trying to reduce the credit utilization and overall DTI as fast as I reasonably can since I'm also looking to buy a home relatively soon (within the next year or so).

For the CC, I've been going back and forth whether to put in a one-time payment of $5,000 to cut it in half, or whether it'd be better to keep the funds considering everything going on with Covid, and just continue to pay the $900 a month. The monthly min is currently $200, so already putting in an extra $700.

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Well that's up to you but you should certainly pay the card down to $6300 (28%) or less and make sure it doesn't report at more than that any more.

[CYBERSAM]

Depending on what is your CC APR, you can get a 10K PL that would bring your revolving UTI down and save on interest. You can get them from CUs and receive the funds in couple of days.

[SouthJamaica]

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@CYBERSAM wrote:

Depending on what is your CC APR, you can get a 10K PL that would bring your revolving UTI down and save on interest. You can get them from CUs and receive the funds in couple of days.

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I don't recommend routinely jumping into loans like that; not a good practice.

[jrands]

EDIT: Repeat post

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[jrands]

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@CYBERSAM wrote:

Depending on what is your CC APR, you can get a 10K PL that would bring your revolving UTI down and save on interest. You can get them from CUs and receive the funds in couple of days.

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I'm looking to buy a home within the year, so looking to avoid new inquiries and new loans.