How do balance transfers effect your score.

[Anonymous]

This problem seems to be a two edged sword. I have embarked on my own debt reduction plan. I contacted credit card companies and some were willing to reduce interest rate however I wanted to transfer some of the higher interest debt to lower interest cards. I did this on one. At the time I did not realize applying for these effected my score so I was like a kid in a candy store trying different ones until I found out these inquiries effected my score. Is there a way of shopping around for cheaper interest cards without affecting my score?

[marty56]

It would depnd on what your util was on the BT card.  Even though your total util would not change some poeple here have reported score drops for a card at high util but total util is not that high.  I have not seen that effect on my FICO score but I only have a single CC reporting.

[Anonymous]

How big of a drop have you heard of for people who have high util. for one card, but not overall util? I've been thinking of transferring the balance of a car that is currently 80% utilized to another card with end result of the other card being only 40% utilized with the idea being that while my total utilization will be the same, that the reporting agencies will view this more favorably than almost being at my credit limit for the first card. What do you think?

[marty56]

I did not see a score change going from 9% total util with 11% on a single card to 1% total util and 1% on a single card.  I dodnt know if there is a score hit on being maxed out on a single card but total util is under 10%.

IMHO going from 80% to 40% would not take a score hit but I dont know if you would see a score increase.  Is the old 80% account being closed?  If so you could take a score hit on loosing account age.  If you could go from 40% to 9% total util, you would see a very nice score boost.