I am trying to be responsible with a home repair that I must finance using 3 available CCs with 0% APRs. As of now, except for Lowe's (7.99% APR), all my CCs are either charging no interest (Venture PIF card), in their intro 0% balance APR periods (WF, FNBO, and 2 Citi cards), or offering a time period of 0% APR for balance transfers (Discover). Thus, I will continue to PIF one card and apply payments in the order of intro APR expiration dates. The main problem for me is that I will be maxing out my 2 new cards (taking advantage of 21 month 0% APR) and bringing my Discover balance near or over 48.8% Util. My aggregate Util will be going from 19% to 35% and crossing a threshold.
The order of expiring 0% APRs is FNBO, Discover, WF, then the 2 Citi cards. There will be times when I'll end up paying interest since I won't be able to pay them down to $0 but that's not my concern. My concerns are what will happen to my FICO scores and could this large amount of charging alert the CC companies in any negative way?
@pi-r-squared wrote:I am trying to be responsible with a home repair that I must finance using 3 available CCs with 0% APRs. As of now, except for Lowe's (7.99% APR), all my CCs are either charging no interest (Venture PIF card), in their intro 0% balance APR periods (WF, FNBO, and 2 Citi cards), or offering a time period of 0% APR for balance transfers (Discover). Thus, I will continue to PIF one card and apply payments in the order of intro APR expiration dates. The main problem for me is that I will be maxing out my 2 new cards (taking advantage of 21 month 0% APR) and bringing my Discover balance near or over 48.8% Util. My aggregate Util will be going from 19% to 35% and crossing a threshold.
The order of expiring 0% APRs is FNBO, Discover, WF, then the 2 Citi cards. There will be times when I'll end up paying interest since I won't be able to pay them down to $0 but that's not my concern. My concerns are what will happen to my FICO scores and could this large amount of charging alert the CC companies in any negative way?
It will both (a) seriously depress your FICO scores and (b) 'alert the CC companies in a negative way'.
Saving interest is lovely, but no one other than you cares about that.
I'm not too concerned about any drastic drop in FICO scores but with the possibility of the banks CLDing my cards as I pay them down?
@pi-r-squared wrote:I'm not too concerned about any drastic drop in FICO scores
Well you asked so I answered
but with the possibility of the banks CLDing my cards as I pay them down?
They very well might
@pi-r-squared wrote:I'm not too concerned about any drastic drop in FICO scores but with the possibility of the banks CLDing my cards as I pay them down?
I don't see how adding 16% would be "drastic drop"! If you had 850 scores then maybe 50 points but with your scores, 20 points max! (my prediction without knowing your CR) As long as you don't put more than 89% on a card.
Just make sure to pay the balance about 4X minimum payment to avoid AA.
If you are not looking to get a new loan or another CC then so what if your score drops few points!
By putting more balance on your new CCs and paying them off, your actually setting yourself up for nice CLIs down the road. 👍
@SouthJamaica wrote:
@pi-r-squared wrote:I'm not too concerned about any drastic drop in FICO scores
Well you asked so I answered
but with the possibility of the banks CLDing my cards as I pay them down?
They very well might
I won't let myself carry any balances month to month under any circumstance at this point in my rebuild, but nonetheless what's the point of a 0% BT rate or any sort of 0% for X number of months if you can't actually use it to your advantage without fear of adverse action?
The 35% overall UTI isn't what is going to set anything off, and nothing to really worry about. Having 90% or above on one card is what has the potential to have the most sting. Maxing out 2 cards will have even more of a bite. How much is really anyone's guess because it really depends on your profile, how thick it is, how old it is etc... you could see as little as 10 points or as much as 45++. If you take the advice up thread of making 3 to 4 times the minimum payment on those accounts, I'd say the likelihood of red flags serious enough to trigger AA will dwindle as any creditor you have doing regular reviews on your report will see you're making a meaningful effort to pay the accounts down. (simply taking advantage of your 0% offers)
