When your credit score is figured. Is it better to carry a small balance on several credit cards rather than having a larger balance on one of the cards. I was wondering if they use your total balance on all cards combined vs. your total credit limit on all cards combined when figuring your balance to credit limit ratio or if it was for each individual cards. I was thinking about moving my credit card debt all to one card with the lowest interest rate.
I do believe it's total credit / total debt. If that's the case, then it probably wouldn't matter if you had a high balance on one card or little balances on several cards, all things being equal.
I think it's a little of both. One of the comments on my reports (when I used to have Privacy Guard) was "you have x accounts using more than 50% of the balance." But a large part is also total debt to total available credit. That said, score shouldn't necessarily always be the main driver. If you aren't looking to get a mortgage or car loan in the near future, it is in the best interest of your financial health to get the lowest rate possible. That's what I've done--maxxed several cards to get good rates. I don't care about the impact on my score because I refinanced my house before rates started back up, and I won't need a car for at least several more years (I hope!!). So, if the score isn't the most critical thing right now, transfer those balances. You'll come out better in the end.
