Hey all!!! This is my first post and I really wanted to say that I am glad to be here among people who are so willing to share their knowledge and experience. Okay----I currently have a MBNA credit card with a $16,000+ balance and an interest rate of 24.98%. They told me that after 6 months of being in good standing (I had been overlimit for a year or so) that I could call back for a lower interest rate. I called last week and yes they lowered it to..... 22.98%. I'd like to apply for a personal loan with my credit union as they offer 7.95%. I have approximately $25,000 in revolving credit listed on my credit report and about $16,000 in installment credit. Should I close out my credit cards in an effort to try to look "better" ? I really need this loan to get out of debt. I would be doing for the purpose of debt consolidation. My credit scores range from 646 to 650, if that helps any. I would appreciate any advice or suggestions you have.
Go and talk to your credit union. They may require you to close the accounts, they may not. But the great thing about credit unions is that you can actually sit down and talk to someone. And every one is different. As far as scores go, you'd be better off to have them open with a zero balance. But you can't use them. If the credit union doesn't make you pay them off, put them in the freezer or something. Otherwise, you'll have the personal loan and run your cards up again.
Thank you so much. I called and they told me that it is my personal decision whether or not to close them. They don't ask you to close your credit cards unless you have had a problem with delinquencies--which I haven't. Here is my problem: I have a judgment on my acct from last year. The judgment has been satisfied since July (or sooner) but is not reflected on my credit report. I have not requested that it be updated because I read that a satisfied judgment is bad. (Is this bad as far as credit scores are concerned or how it reflects on you in general?) So, basically I have been trying to figure out how to get it off. The rep at my credit union said I would need a satisfaction letter from the county where it was filed. But wouldn't't this cause my judgment to be updated to "Judgment Satisfied" after they have verified that it has been satisfied? I'm assuming that it hasn't shown up as satisfied because the landlord never reported it as such. Would this be the case? Lastly, assuming that I am approved for the loan, I would like to close 1 or 2 of my cards. I have three. Do I need 2 open or is 1 okay? Which ones would you keep open? MBNA 22.98% $17,900 credit limit Capital One 12.99% $5,000 credit limit AT&T Universal 9.15% $3500 credit limit Thanks in advance.
If they don't cost you anything, I'd keep them all open. That helps your ratio of balances to credit limit. If you really want to close one, close the lowest credit limit UNLESS it's your oldest tradeline. As far as the satisfaction letter goes, you can probably get it and give it to the credit union without it going to the CRAs. That way it doesn't reflect on your reports.
Thanks a lot Hedwig!!! As a matter of fact I've had the ATT card since 1993 and the other two since 1999.
If you have to close one then, close the Cap One. Especially if you're paying a fee for it. The AT&T is by far your oldest, so keep it. MBNA is the highest limit, so keep it too. But if none cost any fees, why not keep them all. Use them to buy a tank of gas every few months and make sure you pay it off the next month.
Sorry, multiple posts. That's what I get for doing four things at once and refreshing the wrong window!!!
