Advice on Best Strategy to Maximize Current FICO Score while using a Balance Transfer Option

[rdrarmy]

Good afternoon to myFicoers, I have a question where I can use some helpful advice for my current situation. I have an opportunity to do a balance transfer with my Penfed PCR card for 18 months at 0.99% with a 3% balance transfer fee to pay off one of my cards that currently has 69% utilization with an interest rate of 9.65%. With my current scores, should I transfer up to 29% of the available CL to my PCR card while reducing my other card to 29% utilization instead of the 69% and paying both of them off in the 18 month period? Or should I just transfer the entire balance into the PCR card which will put that card at 96% utilization? My intent is for my current scores to maybe improve instead of taking a hit. Is it safe to assume that by reducing the 69% utilization card to 29% I should see a little improvement if any? Thanks again for your input!

[Anonymous]

If your highest utilization card moves from 60-something percent to 20-something percent, I would expect you to see some score improvement.

One thing you didn't mention was what your current credit limit is on the 2 cards in question.

Also I know nothing about the card that you're planning on doing a BT to, but maybe you can request a (SP) CLI on it first in order to help absorb some of the utilization percentage associated with the BT?

[SouthJamaica]

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@rdrarmy wrote:
Good afternoon to myFicoers, I have a question where I can use some helpful advice for my current situation. I have an opportunity to do a balance transfer with my Penfed PCR card for 18 months at 0.99% with a 3% balance transfer fee to pay off one of my cards that currently has 69% utilization with an interest rate of 9.65%. With my current scores, should I transfer up to 29% of the available CL to my PCR card while reducing my other card to 29% utilization instead of the 69% and paying both of them off in the 18 month period? Or should I just transfer the entire balance into the PCR card which will put that card at 96% utilization? My intent is for my current scores to maybe improve instead of taking a hit. Is it safe to assume that by reducing the 69% utilization card to 29% I should see a little improvement if any? Thanks again for your input!

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The first option will definitely be better for your scores. Yes 69% isn't good, and 96% would be even worse.

[rdrarmy]

@Anonymous, The CL's for the two cards in question are as follows: BT Card (PENFED PCR) has a CL of 10K which I plan on only using 29% of the CL. The other card (NFCU CR) that has 69% utilization currently has a CL of 13.5K. The CL for the PCR card already reflects a CLI that I received a week ago, so I've already exercised that option. As for requesting a CLI with my NFCU CR card, I have currently reached their internal credit limit due to two other cards I have with them which reflect in my signature below. Thanks for your feedback!

[RSX]

i think it depends if you are looking to aggressively pay this down - or if you want to use the whole 18 months

i would personally move the whole amount over - even if it bumps you to 96%

benefits are

1. you will not be paying 9.65% interest on the outstanding balance - currently costing you $72/month - will still be $30-$40 go forward if you go the partial payment route

2. you wont be splitting your payments onto 2 cards - you will putting all money towards the 1 BT card and not paying much interest at all ($7/month)

that 96% wont last long, once you start hitting it with payments - it will show a steady drop month over month, and some points will come back as soon as you drop below 87% or so

[rdrarmy]

@RSX, thank you for the feedback.