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Thread: Regarding Credit Card Balances

  1. Southern girl at heart
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    #1

    Regarding Credit Card Balances

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    I have a question regarding the balances I have on 2 cards.

    Currently, my highest balance credit card is the lowest interest. It currently has about 1/3 available credit. The other card I have is a higher interest (by 7% or so) with a significant balance that I would like to eliminate quickly.

    I do not have the option to pay it off all at once and I was just laid off from my position. We are buying a house this year, and have already had our credit evaluated and were pre-approved based on the credit we had at the time. Since then, we have acquired only about 300 or 400 more.

    My question is, is it better to pay only the minimum on the high interest credit card, which is all we can do now. Or would it be beneficial to do a balance transfer to the lower interest card (currently offer 2.99% balance transfer interest - then a similar rate to what it currently is)?

    My concern is for the mortgage we hope to obtain, will this show poorly?

    Thanks!
    Nicole
    "Sometimes all you need is 20 seconds of courage..."
  2. Regular Member
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    #2
    is there a fee to do the balance transfer? Will you be maxing out the new credit line? how long is the low rate transfer good for, when will it adjust? Is the current line maxed out or over half the limit? There are ALOT of things that will make a difference if this is a good choice $$$ and alot of things that will factor in how it will affect your credit score. For example if your current card is only using 1/2 of your limit then that is a good thing so transferring it to a new card that would appear to be maxed out would not look as good. Plus depends on how quick you are purchasing and how quick all the changes appear on your credit report. It also depends on how tight things are with your approval. Are you using a mortgage broker or have a loan officer? If so then I would discuss what you are thinking about doing with them to find out what an Underwriters stand point might be. On the $$$ you will have to calculate it out as far as fees and changes etc. I have not been in the finance world for a few years so some of this could have changed but hopefully this is a starting point for you as far as things to think about.
  3. Banned
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    #3
    1) the pre approval- if your preapproval was based on 2 incomes and your CC balances are higher you may have just lost your loan-

    my dad has a pretty decent income- got a 50,000 dollar loan and was told he could have NO CC debt to qualify for the loan!!

    it is getting harder and harder to to get approved for a loan right now.

    as for the balance- keep them where they are- and pay the min on the lowest card and over the min on the higher interest card.

    you can also alternate between the 2- pay higher on one one month and then higher on the other the next month until you can get a job again.
  4. was ncgirl
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    #4
    Quote Originally Posted by gunsgirl View Post
    1) the pre approval- if your preapproval was based on 2 incomes and your CC balances are higher you may have just lost your loan-

    my dad has a pretty decent income- got a 50,000 dollar loan and was told he could have NO CC debt to qualify for the loan!!

    it is getting harder and harder to to get approved for a loan right now.

    as for the balance- keep them where they are- and pay the min on the lowest card and over the min on the higher interest card.

    you can also alternate between the 2- pay higher on one one month and then higher on the other the next month until you can get a job again.
    I agree. Also, it isnt good to have a credit card just "sitting" there, ie no payments, no balance.


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  5. Southern girl at heart
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    #5
    Thanks Ladies! our loan was actually only my husbands income, as I was working temp...so that's why I am not totally panicked about it!

    And I think it may be smarter to just keep it as is, and pay over the min where needed/available.
    Nicole
    "Sometimes all you need is 20 seconds of courage..."

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