Hii, I hope this is the right place to post about my issue. I have a problem, my credit scores are from TR 681, EX 665, EQ 632 with too many accounts with balances, problem is some of these cards I am an authorized user so Im not sure how it will affect me since the new changes took effect on how utilization is looked at regarding authorized user. so here is the break down Equifax: MINE: 3 months old WAMU B:1350 L:1500 7 month old GEMB/IKEA B:0 L:300 10 month old Citi Card B:3004 L:3400 10 month old GEMB/Amazon B:0 L:600 21 month old HSBC BANK B:2069 L: 2400 20 month old best buy B:0 L:2100 26 month old WAMU acct B:1158 L: 2000 27 month old THEHOMEDEPOT B:0 L:1500 27 month old AMEX BLUE B:700 L:1000 30 month old Firestone charge card B:0 L:1400 30 month old CAP ONE B:900 L:2000 36 month old CHASE CC B: 4658 L:5000 OTHER: 11 month old CITI FLEX line of credit B:10'113 L:11'000 4 month old BMW LEASE B:14k AUTHORIZED: 14 month charge acct GEMB/GAP B:0 L:600 24 month old CHASE account B:4345 L:5000 24 month old AMEX GOLD This should add up to around 13k in CC charges and 10k citi flex 14 k in BMW lease (paying 875 a month) so right now I have 12k in cash and another 4-5k in 2 months. What should I pay first for best credit score impact? And what credit cards or store cards should I close? I would appreciate any replies, I am in real need of some advice, I have read a lot around the forums but cant seem to decide on a proper solution. Transunion dosent have the BMW lease up yet. Also if I close the new accounts, will it affect my age of accounts in a good way? Thank you!
Pay off your higher interest and high balances.You could take your self off of the au accounts.Pay down the rest.
Utilization of an AU account has never changed. You get the good with the bad on an AU. If the utilization on the card is high, then your utilization will be high as well. Those cards really aren't helping you much. It looks like you have accounts as old, or older, and the Chase card is over-utilized. AU accounts are some of the easiest to get removed from your credit reports. Just having yourself taken off the accounts won't usually be enough, as they will likely still report. You will have to dispute them. You should get everything below 50% balance to credit limit. 30% they say is the ideal, but it doesn't look like you have the funds to do that yet. Ignore the BMW lease for right now (if you are only worried about scores) - that one doesn't factor into your utilization. I wouldn't close any of the accounts right now, unless they are charging an outrageous annual fee that you can't get waived or something. Definitely don't do it unless they are reporting a $0 balance. On the flip side, in this economy, many many people are reporting their credit limits being reduced, as banks lower their risk. If that were to happen to you, you could spend 12K, see your credit lines cut - thus keeping your utilization high. Still not have a super great score, AND have many cards that need a payment on them each month. I would weigh that option, and consider what JJ said, and pay off your higher interest rate cards first. If it were me, I would probably clear those two or three small balance cards so I didn't have to deal with them monthly, and then hit the high interest rates.
Oh, and finally, even though FICO may (I don't know) penalize you some pointage for being over-utilized on individual cards, if you opt to pay off the high interest cards, your over-all utilization will still improve (as long as you close no cards), and you should see a score improvement.
I would take a third of the available paydown funds and divide it so that every card winds up with as close to an equal utilization percentage as possible. The next month, I would use another third of the available paydown funds (half of what I had remaining after paying the first third) to maintain the equalization policy (or close the gap on any cards where it couldn't quite be achieved), but I would also pay off any small rats & mice balances. The month after that, I would use half of what I still had to pay toward the cards and again pay them down so that the percentages remained in lockstep. (the remaining half I would hold in savings--I would continue to pay the cards out of the ordinary stream of income). FICO likes steady, predictable payments, and you're really not doing yourself a huge favor when you just apply a huge chunk of cash to cards all at once. Might as well hold that cash in savings as a cushion even if it costs you a bit of interest.
thanks you all for you replies, I saw some of your messages late but what I did yesterday was pay about 7k down closing the smaller accounts. Since it has been a hassle logging into 10 account pages at one time. I have had a car that is around 5 years or so old I never got to selling it but I am trying to so I can put down a payment on the citi flex line of credit. So even if I take my self off the AU accounts they will still show? Either way the AU chase account will be paid too so its nothing im not worried about for now. I just hope i dont see any CLD
What the problem is now all the cc are cutting cl because of the slowdown.Unless your with aig and take the bailout money and go to a resort and run up a 500,000 dollar bill.
I don't know a lot about credit, but one thing I have learned reading these boards is NEVER close an account! It hurts your utilization. It's not how many accounts you have, it's how many accounts you have with a balance.
Reopen Those Closed Accounts Asap! Those smaller accounts you closed, OP, can be reopened with a phone call ... the sooner you make those calls the better (some have short time limits ... 30 days or under). They expect that some people will close accounts and reopen them right away because mortgage underwriters sometimes require that lines of credit they consider to be excessive get closed by the borrower. They don't really care if the borrower turns right around and reopens them.
