Paying down balances in large amounts

[teeder27]

I have several cards with balances on them and have freed up some money to pay most card balances off completely.  My question is this- When I would make a larger payment on a card, my TU score (specifically) would drop, because the balance on the card went down.  If I were to want to pay off most all of the balances on the cards that I do have, should I do it all at once and pay them completely off in 1 payment, or should I split the payoffs into 2-3 payments over 2-3 months to have less of an impact on my score?

I know there is the simulator on the site here, but when I plug a scenario into it, it says my score will go up x points, but in reality, it drops x points.  

Any suggestions?

Thanks!

[GatorGuy]

Your score will increase as you pay down your balance. Improving your utilization will improve your score.

The only risk would be depending your lenders and how long you've been carrying the balances, sometimes they will decrease your CL after you pay down balances.

Despite all that, pay your balances off as fast as possible to save interest.

Never trust any credit simulator. They're pure hokum. 

[OmarGB9]

Paying down balances would never decrease your score. Something else was causing your score drops.

And ignore all simulators.

[SouthJamaica]

---

@teeder27 wrote:

I have several cards with balances on them and have freed up some money to pay most card balances off completely.  My question is this- When I would make a larger payment on a card, my TU score (specifically) would drop, because the balance on the card went down.  If I were to want to pay off most all of the balances on the cards that I do have, should I do it all at once and pay them completely off in 1 payment, or should I split the payoffs into 2-3 payments over 2-3 months to have less of an impact on my score?

I know there is the simulator on the site here, but when I plug a scenario into it, it says my score will go up x points, but in reality, it drops x points.  

Any suggestions?

Thanks!

---

1.  No FICO score would go down because you paid down a balance. The only time it could trigger a score decrease would be if all your revolving accounts reported zero balances.

2.  You should pay them off ASAP.  No benefit to doing it in bits and pieces.

3.  The simulators are worthless. Disregard.

[Kforce]

^^^ This

All three of the above posters are right on the money.

[Anonymous]

Pay off all credit cards, with one exception. Leave a tiny balance on only one card. If all your cards are paid to zero, your score will drop.

[Kforce]

---

@Anonymous wrote:

Pay off all credit cards, with one exception. Leave a tiny balance on only one card. If all your cards are paid to zero, your score will drop.

---

^^^ This might "Not" be a good idea, depending.

First order of business is to pay off all cards and reset grace period for each.

If you have been carrying balances and paying interest.  You need to pay all off to zero, which most likely is larger than current balance shown on web page.  Each needs to report zero for a statement or two to reset the grace period.  Trailing interest needs to be paid and grace period reset prior to playing with what utilization reports.

[disdreamin]

^^ This

For those of us not as well-versed in AZEO and the like, it's important to point out that allowing a small balance to report is very different from paying interest and carrying a revolving balance on cards. I think you only need to AZEO once and then pay trailing interest and it goes back to free float without interest being charged, but I'd do what is suggested above and zero all cards for two billing cycles just to be safe, if it were me.

[ThomasJNewton]

While most of the people on here said that the simulators are useless, I disagree. They are right that they will not help you predict your credit score, they are valuable for hours of distraction when used sort of like Sim City. "What would happen if all of my issuers were to triple my credit, while I paid everything else off and opened three new cards each with 75K starting lines?"

"How about if my income doubled, and I got two mortgages for $500,000 each?"

Mod cut - not here 

These scenarios and so much more are available to you! :-)