Here is the deal. I owe one credi card $900 and will pay it off Dec 1 Credit limit is $1500 I owe another credit card $900 and will pay it off Dec 1 Credit limit is $1000 I owe another card $500 and will pay it off Jan 1 Credit limit is $500 I owe another card $1400 and will pay it off Jan 1 Credit limit is $1500 I have a large debt on another card of $12000 and will pay off $1000 Jan 1 Credit limit is $16000 I owe another card $1800 and will pay it off Feb 1. Credit limit is $2100 In addition I still owe $9500 in student loans How will these payoffs effect my credit scores? Should I close the accounts after I pay them off? How much time whould I expect it to take before my score increases? I have on 90 day late showing on a old paid off student loan from 6 years ago. I have one 30 day late shoing up from a student loan 3 years ago. I would like to buy a house the first of April with 10% down. What approach should I take? Keep accounts open but showing paid-in-full, or close accounts? My current average credit score is 680. Your comments are appreciated. Thanks.
Keep all of the accounts open. Your scores should rise to about a 730 to 750. The rise will take effect as soon as the balances update which is about 30 days after payment. Don't worry about the lates, they're too old to even be effecting you.
Thank you! I have been hanging in there for several years making minimum payments, sometimes paying off the cards only to take cash advances and then paying off again in a month or two. My income has finally stabilized and i can see light at the end of the tunnel. The big account worries me a bit but I can only pay the $1000 on it and then go back to making $400 per month payments. The amount owed versus the credit limit bothers me a bit, but it sounds as if this won't hurt me too bad.
You should be fine and I'm glad to hear things are getting better. Sometimes minimums are all that can be proferred but, it seems as though you've got yourself in a good position.
After you pay off everything (and yes, do leave the accounts open) and your score updates, why don't you contact the bank you have the big credit card with and see if they'll up your limit. That will help lower your ratio a little, which should help. And the accounts that you pay off but keep open, use each one once every few months to keep some activity. Buy a little something and pay it off when the bill comes. I'm glad to hear things are going better, too. Just keep everything paid up and you'll be fine.
