CC debt question

[Deleted]

We will be paying off all of our credit cards within the next three months. We have about 2k to put towards them now. We have three totaling about $4500.

Would it be best to pay on each of them right now to get them below 20% or pay off one and then work on the other two over the next few months? Does it make a difference score wise? All are within 1% of each other so the interest rates aren't killing us.

[simpsongal]

If the interest rates a pretty close then I would try the snowball approach (start with the lowest balance or the highest interest rate card). That is, concentrate on one card and then proceed to the next. It won't make a difference in your credit report so long as you keep making the other minimum payments on time. The idea behind the snowball is that seeing real, quick progress on one debt will build momentum for you to pay the others.
Good luck!

[aspentosh]

Jan 23, 2013 12:16:57 GMT -5 simpsongal said:

If the interest rates a pretty close then I would try the snowball approach (start with the lowest balance or the highest interest rate card). That is, concentrate on one card and then proceed to the next. It won't make a difference in your credit report so long as you keep making the other minimum payments on time. The idea behind the snowball is that seeing real, quick progress on one debt will build momentum for you to pay the others.
Good luck!

Exactly. If you have one smaller, one medium and one larger balance, it's recommended to start with the smaller one.

That being said, if one is close to maxing out (ie $1000 balance with $1200 limit), I'd pay that one off first. I don't figure a couple months would make that big of a difference on your credit report if you don't do this...

[aurora]

Your 20% rule-of-thumb on the debt ratio should be across all your cards, so it won't matter if you have all of them below 20% or just the total below 20%. I would pay off the highest rate first if you can do so with the $2k. If not, at least pay off one of the 3 and put whatever is left to the one with the highest rate, then focus on paying that one off next.