Paying revolving debt

[Anonymous]

My current revolving credit usage is 64% of the limit. 2 cards have zero balances and 5 cards are around 95% of their limits. I have a lump sum of cash that will be 1/3rd of the total balance. Does it make a difference to my FICO score if I pay it all to one card to get the utilization to under 5% (leaving 4 cards maxed out), or spread it all around to get all of the cards with balances to around 65%?

[pizzadude]

I think you'd be better off with the latter scenario ~ paying all of them down. Maxed out CCs really aren't good for your FICO® score.

[Anonymous]

I think you should focus on your debit first then your score!

Just pay the highest intrest one down or off and then sequintially compound payments and  pay off all of them in that order i.e. highest to lowest intrest rate!  Your score will reflect with super duper dividens.  It may take longer but it's the best way your going to save money!

[Jazzzy]

My score seems to react best to a fewer number of balances. I'd pay what I could to zero (starting with the highest interest) and then go on to the next card.

[crunching_numbers]

I would try and do a bit of both.  Pay every card down below 80% so nothing is maxed.  Then either zero out what you can, or throw the balance you have left at the highest interest rates.  Which one you do depends on whether maxing your FICO or paying less interest is the priority at the moment.

[Quips]

Agree with crunching numbers - get them all down under 80% as FICO doesn't like "maxed out" credit lines. Then use what is left to pay down/off the highest interest rate cards.

[compassion101]

---

@crunching_numbers wrote:

I would try and do a bit of both.  Pay every card down below 80% so nothing is maxed.  Then either zero out what you can, or throw the balance you have left at the highest interest rates.  Which one you do depends on whether maxing your FICO or paying less interest is the priority at the moment.

---

Agree with this.What does FICO consider maxed, is it really 80%+? I thought I had read somewhere that it was 90%+?

Also I agree with concentrating on your debt right now as opposed to your score. Unless you are buying a home right now, you probably don't need to be applying for credit atm.

[MarineVietVet]

---

@compassion101 wrote:

---

@crunching_numbers wrote:

I would try and do a bit of both.  Pay every card down below 80% so nothing is maxed.  Then either zero out what you can, or throw the balance you have left at the highest interest rates.  Which one you do depends on whether maxing your FICO or paying less interest is the priority at the moment.

---

Agree with this.What does FICO consider maxed, is it really 80%+? I thought I had read somewhere that it was 90%+?

Also I agree with concentrating on your debt right now as opposed to your score. Unless you are buying a home right now, you probably don't need to be applying for credit atm.

---

I don't believe there is a hard and fast rule about this. I've seen different percentages offered as being maxed out. As with many things it will be an individual, YMMV situation. I would only counsel to try and not approach either figure if at all possible.

[Anonymous]

I am trying buy a house. Loan officer says I need a 660 FICO score, I currently have a 626 middle score because of a 1 year old $25 paid collection account. I am currently at 64% overall of my credit limit. I can pay this to 40% and not compromise my down payment. Loan officer thinks paying off my largest credit balance will be enough (all my cards are either at $0 or 90%+). I can pay them all to under 80% and get the largest one to under 30%, or I can pay the largest one completely off, but the rest will still be 90%+.

[Anonymous]

Is there a point when you pay them down that it doesn't matter to much? Like, is 25-30% the same as having the card paid off?