New Credit Lines Vs. High Balances
Whats up everyone...
Right now I have about 3 credit cards.
One has a very low balance compared to the limit. The other two are practically maxed out at around 5k each. My question is would it be better to open another line of credit and balance transfer to take the balances down on the two cards that are maxed out or would opening another line of credit only hurt me more? Whats the percentage of balance to limit that starts to hurt your credit. Any advice here would be greatly appreciated.
Thanks,
neutral
Quote:
On 2004-03-15 17:36, neutral wrote:
My question is would it be better to open another line of credit and balance transfer to take the balances down on the two cards that are maxed out or would opening another line of credit only hurt me more? Hard to know what the effect of a new line would be. But here's the naked effect of utilization:
http://www.creditboards.com/phpBB2/viewtopic.php?t=3207
They like to see how you manage your credit so opening a new tradeline (an inquiry that drags it down a few points at the get go) and transferring IMO isn't really managing it well.
Pay them off, do not close them and then charge a few hundred and payoff each month. That's the best way.
what is IMO??
neutral
IMO = in my opinion
I understand what the ideal situation is.. But if my only two choices are having to lines of credit almost maxed out or opening additional lines of credit to space the balances over more accounts... whats the best option,.
neutral
Hi,
At my local REI meeting tonight, it was Meet the Money people tonight and we were able to network with about 10 diff lenders/brokers in the area and ask them questions. As I spoke to one guy, we talked about credit scores. I need to loosen mine up a bit. He told me I could increase my credit rating by as much as 20 points by not having more than 75% of my limit be my balance. I told him I have several cards maxed out and he said to get a new card and transfer some of that debt to the new card so that there is at least 25% free.
Ex. credit limit is $1000, have no more than $750 on it.
I really trust this guy. He comes highly recomended from my REI group and we have over 700 in our group.
Hope this helps.
caseycat--
thanks for your response... i have to cards at 5k each-- i think i will open up another line of credit to transfer some of the balances over... so you think under 75% is good enough? I was thinking under 50%.. anyway-- i appreciate everyones help.
neutral.