Balance Transfer Question

[Anonymous]

Im thinking of absorbing my DW debt for a year. Question is this, when I eat her debt and her cards go to a zero balance--What happens if I add myself as an authorized user to those cards? Since my score is going to get smashed from her debt, will it then balance out by adding her now zero balance cards to my report? Make sense?

[Anonymous]

It will depend on the math based on the amount you are taking on, her credit card limits etc.  It will also depend on how balanced your accounts are used in FICO scoring.  So in the end, it might now balance itself out.  

[Anonymous]

You have the tools to answer this question.

Figure out what your total credit limit is now and your total debt.  That will tell you your total utilization.  Then after the hypothetical BT and adding yourself as an AU, figure out your new total credit limit is now and your total debt. That will tell you your new total utilization. 

Crunch the numbers and see if your utilization has gone up (it will have).  Then tell us what the total U is before and after.

Also tell us what your individual U is on your particular card.  My guess is that it will have gone up to a very high number.  That's also bad for your score.

[Anonymous]

I have $37,500 in avail credit spread out over 4 cards. Less then 1% utilization. The CL in the card that will bring the BT over has a $6600 limit, and roughly $5500 of it will be gobbled up with the BT. So now $5800 will be freed up on her cards, spread out pretty much evenly over three cards. So if I add myself as an AU on those three cards do you think that will help the hit I"m going to take with the BT? 

Also, two of the cards DW has are from a bank that I eventually want to get a card from--do you think it hurts my chances with them if I absorb debt from them onto my card? Would they even know?

[Anonymous]

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@Anonymous wrote:

I have $37,500 in avail credit spread out over 4 cards. Less then 1% utilization. The CL in the card that will bring the BT over has a $6600 limit, and roughly $5500 of it will be gobbled up with the BT. So now $5800 will be freed up on her cards, spread out pretty much evenly over three cards. So if I add myself as an AU on those three cards do you think that will help the hit I"m going to take with the BT? 

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You have the tools to answer this question.

Figure out what your total credit limit is now and your total debt.  That will tell you your total utilization.  Then after the hypothetical BT and adding yourself as an AU, figure out your new total credit limit is now and your total debt. That will tell you your new total utilization. 

Crunch the numbers and see if your utilization has gone up (it will have).  Then tell us what the total U is before and after.

Also tell us what your individual U is on your particular card (after the BT to it).  My guess is that it will have gone up to a very high number.  That's also bad for your score.

[Anonymous]

It looks like my overall util will go to 16%, up from 0..If I add myself as an AU it will only drop to 14%..I think..

Are BT HP's?

[Anonymous]

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@Anonymous wrote:

It looks like my overall util will go to 16%, up from 0..If I add myself as an AU it will only drop to 14%..I think..

Are BT HP's?

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A true 0% utilization would be all cards at $0.  Were all your revolving accounts at $0, or did one of them show a positive balance?

What will the individual utilization be for the card that you do the BT transfer to (after the transfer)?

[Anonymous]

No, not true zero...total util would actually be .001.....After BT utilization on BT card would be 90%(all other cards at zero), total across all cards now would be 16%, up from .001..if I add myself as an AU on DW cards, total utilization would only drop to 14% from 16%...My scores are 780's, I imagine this will be a significant hit---does myfico have a score simulator for raising cc balance? Are BT's HP's if youre not doing it on a new card?

[Aahz]

No, balance transfers do not generate hard pulls.

Having a card maxed out at 90% is going to hurt your scores more than overall utility climbing to 14%/16%.

The real question, IMO, is - are you going to be using your FICO score (aka apping for new credit) while carrying this BT?  If not, then it's nothing to worry about.  If so, then you want to figure out timing so that you're not apping until overall utility is below 9% and single card utility is below 49%.

[Anonymous]

So now we have enough to answer your first question.  Your toal utilization before is 1% and after the AU cards are added it goes to 14%.  So there is a hit there, since you are crossing over 8.99%.  And then as far as individual util goes, you are going from no penalty to a fairly big one for a maxxed out card.

So no, adding the AU cards won't balance things out.

Yes, myFICO has a score simulator but a lot of people think it is unreliable.

And no, I can't see why BT's would involve an HP, though perhaps someone else can chime in about that.