@Anonymous wrote:Hi,
I have a handful of credit card accounts and no other types of credit. My score is 602 (transunion + equifax, as shown by CreditKarma), and my accounts are as follows, with all payments current:
Discover: $1,528 used out of $1,500
VISA: $20,232 out of $20,000
AMEX: $10,109 out of $10,000
Mastercard: $282 out of $300AMEX (Authorized user only): $0 out of $38,500
CLOSED BUT HAS BALANCE: Bank Personal Line of Credit: $8,497 out of $5,000 used (yes, very much over).
A few 30-day lates were assessed about a year ago. Average age of accounts is close to 10 years. My "Credit Card Utilization" as reported by CreditKarma is 46%
My question is this: I am expecting a sizeable tax refund, which I want to use to pay down my debts for the purpose of boosting my FICO score as much as possible. When I use CreditKarma's "Simulate My Score" feature (off of its TransUnion section), it tells me that if I pay down $4,100, my score will go up by 84 points to 686. The problem is, it doesn't tell me which accounts I should pay down to expect such an impact. Can you guys please tell me what your recommendation would be (which accounts should I pay down with that $4,100) to get such a boost? I am assuming that I should make sure that none of the accounts are OTL first, and then use the remaining amounts to pay down as much as I can of the smaller cards FIRST? For this purpose, does it matter if I pay it down just slightly over the limits, or would you recommend me to be a certain % below the limits? Meaning is getting an account $2,999 out of $3,000 give me just about the same boost as if it was $2,500 out of $3,000? (Obviously I understand that the more I pay it down the better, but here I am talking about it in scope of maximum FICO score boost...)
THANKS
Your Discover card has a For Reals TU FICO score. What is that on the latest statement?
In all this advice, be sure to make the minimum payment, on time, for each account. You probably know this, but everything else you do will be secondary to this primary rule.
The first step would be to get each of the open cards down to below 90% of the limit. Now, given where you are with each of the cards, it is possible (though by no means certain) that you will get a CLD on one of the cards. If that is the case, the CLD should be to something more than what you have outstanding. I've been through many CLD steps on multiple cards in the past. As long as you are paying at least the minimum payment on time, there's not a whole lot more the CCC can do, so just hang in there and keep working the balances down.
The closed LOC, I would not worry about that vs the limit, it's probably being factored differently ( meaning FICO is likely not strictly following that limit since the account is closed) so you do want to pay it down, but the published limit may not be a factor. If the bank is charging you over-limit fees, that changes the discussion, because there you want to be minimimzing such costs. That may be a reason to pay faster on that account, once the CC are reduced below their limits.
Pay the MasterCard to zero, to stop any interest charges on that card. You could then use that card for your daily spend, as long as you are paying it frequently and not carrying any balance.
What are the APR on each of the cards and the PLOC?
@Anonymous wrote:Hi,
I have a handful of credit card accounts and no other types of credit. My score is 602 (transunion + equifax, as shown by CreditKarma), and my accounts are as follows, with all payments current:
Discover: $1,528 used out of $1,500
VISA: $20,232 out of $20,000
AMEX: $10,109 out of $10,000
Mastercard: $282 out of $300AMEX (Authorized user only): $0 out of $38,500
CLOSED BUT HAS BALANCE: Bank Personal Line of Credit: $8,497 out of $5,000 used (yes, very much over).
A few 30-day lates were assessed about a year ago. Average age of accounts is close to 10 years. My "Credit Card Utilization" as reported by CreditKarma is 46%
My question is this: I am expecting a sizeable tax refund, which I want to use to pay down my debts for the purpose of boosting my FICO score as much as possible. When I use CreditKarma's "Simulate My Score" feature (off of its TransUnion section), it tells me that if I pay down $4,100, my score will go up by 84 points to 686. The problem is, it doesn't tell me which accounts I should pay down to expect such an impact. Can you guys please tell me what your recommendation would be (which accounts should I pay down with that $4,100) to get such a boost? I am assuming that I should make sure that none of the accounts are OTL first, and then use the remaining amounts to pay down as much as I can of the smaller cards FIRST? For this purpose, does it matter if I pay it down just slightly over the limits, or would you recommend me to be a certain % below the limits? Meaning is getting an account $2,999 out of $3,000 give me just about the same boost as if it was $2,500 out of $3,000? (Obviously I understand that the more I pay it down the better, but here I am talking about it in scope of maximum FICO score boost...)
THANKS
1. Disregard Credit Karma. Its simulator is meaningless. And the Vantage 3.0 scores it provides are functionally useless.
2. If you have $4100 to pay, pay it as follows:
(a) Discover $1528.00
(b) Mastercard 282.00
(c) Visa 300.00
(d) Amex 1990.00
