| Need a bit of help with financial decision...Close CC's? |
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tifosiv122
New Member
Cash: $ 1.25
Posts: 6
Joined: 03 Jun 2006
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| Need a bit of help with financial decision...Close CC's? |
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Thanks for looking. I'm 25 years old and I am in a bit of a situation and I need some advice.
I currently rent my apartment, $800 a month, always paid on time. I was approved on my own credit 2 years ago (no co-sign). I own a new Mercedes and an older (99) GMC Jimmy...both paid for up front in cash, no loan whatsoever.
I am about $13,000 in CC debt spread over about 10 cards. I have 2 cards with about $3,000 in total that are at 0% interest for the life of the transfer.
I have about $10,000 in cash that i was thinking about paying the other CC's off, so I would only have about $3,000 in debt, but that would be at 0% interest.
I am wondering if it is a bad thing to have $10,000 in CCs not being used. By this I mean, would it affect my credit report when I decide to buy a house in the next year or so. What I'm basically asking is, after I pay them off, should I close (none of them have annual fees).
Any advice would be great as I really have no idea on the subject. I was always told to carry some debt and make sure you pay on time, which, for the most part I have been (I missed a few on vacation and such) but I never let it get out of hand (no harrassing calls or anything).
If you need any more info (sans SS# and such, lol) just let me know.
Thanks in advance,
Erik
EDIT: Forgot, no student loans or any loans. Just rent, cell-phone, & cable bills.
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Sat Jun 03, 2006 7:08 am |
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tifosiv122
New Member
Cash: $ 1.25
Posts: 6
Joined: 03 Jun 2006
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quote:
Originally posted by muneepenee
5. how did yu get 10 kredit kards in 2 yeers?
Not sure where you got this from, I've had my CC's since I was 18, so 7 years.
quote:
Originally posted by muneepenee
6. apparentlee yu paed kash for evreethang up tu 2 yrs ago.
wi did yu stop? fall off the wagon?
No, I've paid for some things in cash, others on the CC. Generally the CC was for BS stuff, extra computers, stereo, flat screen TVs, etc.
quote:
Originally posted by muneepenee
7. "for the life av the transfer"???????? wot du that meen ?????????
Bankers kan chaenj theer rules NE-time em feel like it. Dont trust NE-thang em "garantee". Even if reelee 0%, pae it off.
rule-av-thum is...pae off hiest interest rate lone first.
The 0% offer was for balance transfers, and for the life of the transfer, assuming I don't violate the agreement. I've had it this way for well over a year and I have not had a problem.
quote:
Originally posted by muneepenee
8. "about 10 kk's"...dont yuno how many kredit kards yu hav?
Honestly, never bothered counting and my wallet was in the car so I just guessed.
quote:
Originally posted by muneepenee
9. wot kind av current du yu yuze for the rent?
Not sure this question but I think you mean how do I pay the rent. I pay in cash (check).
quote:
Originally posted by muneepenee
10. "was approved on mi oen kredit"...yu tri tu sae yu got a kredit kard????
This means 2 years ago when I rented my apartment my credit was good enough that I didn't need a co-signer. Nothing to do with a CC.
Erik
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Sat Jun 03, 2006 3:39 pm |
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Kiaser
Senior Member
Cash: $ 43.05
Posts: 209
Joined: 12 Apr 2006
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| Re: Need a bit of help with financial decision...Close CC's? |
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quote:
Originally posted by tifosiv122
Thanks for looking. I'm 25 years old and I am in a bit of a situation and I need some advice.
I currently rent my apartment, $800 a month, always paid on time. I was approved on my own credit 2 years ago (no co-sign). I own a new Mercedes and an older (99) GMC Jimmy...both paid for up front in cash, no loan whatsoever.
I am about $13,000 in CC debt spread over about 10 cards. I have 2 cards with about $3,000 in total that are at 0% interest for the life of the transfer.
I have about $10,000 in cash that i was thinking about paying the other CC's off, so I would only have about $3,000 in debt, but that would be at 0% interest.
I am wondering if it is a bad thing to have $10,000 in CCs not being used. By this I mean, would it affect my credit report when I decide to buy a house in the next year or so. What I'm basically asking is, after I pay them off, should I close (none of them have annual fees).
Any advice would be great as I really have no idea on the subject. I was always told to carry some debt and make sure you pay on time, which, for the most part I have been (I missed a few on vacation and such) but I never let it get out of hand (no harrassing calls or anything).
If you need any more info (sans SS# and such, lol) just let me know.
Thanks in advance,
Erik
EDIT: Forgot, no student loans or any loans. Just rent, cell-phone, & cable bills.
You want to keep three to four credit cards open, 10 is too much. And make sure the three or four you keep are premium bank cards, not retailer or gas cards. However, above all do NOT close your oldest credit cards, as they indicate on your credit when your history started. If you close off your oldest cards they will hurt your credit badly. You'll want to do all this at least 6 months before applying for a mortgage, as it takes time to appear on credit and level out.
There's hardly any "good" debt so I'd be paying down all that you can ESPECIALLY on consumer debt such as credit cards. You're young and can probably get along fine with putting all that $10k towards the debts. The $3k on the 0% cards are ok, but you'll still have to make minimum payments and regardless they lower your debt-to-income rating on your credit. Of course pay the interest gaining debt first, preferably the highest interest rate accounts first, then go after the $3k 0% debt. Get all that off your credit and it will be squeeky clean (not to mention you'll feel a heavy load lifted off of you).
Remember, almost anyone can get a mortgage, even horrible credit. Debt-to-income is a very important factor in getting good rates and terms on a mortgage.
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Sat Jun 03, 2006 6:23 pm |
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tifosiv122
New Member
Cash: $ 1.25
Posts: 6
Joined: 03 Jun 2006
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Thank you, that's what I was looking for.
Unfortunately, my first CC was a student card and still only has a $300 limit @ 29%. Eeek. I use this to pay for Netflix and stuff, generally paying it off each month. I guess after I pay down the others and start to close accounts I could ask for an increase as the newer ones have the $2-3,000 limits.
I don't have retail or gas cards.
Thanks again, if anyone has any other input, feel free to share.
Erik
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Sat Jun 03, 2006 6:30 pm |
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tifosiv122
New Member
Cash: $ 1.25
Posts: 6
Joined: 03 Jun 2006
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quote:
Originally posted by muneepenee
1. yu dont need a kredit kard tu hav kredit. Me bied me first hous at 24.
Got me first & oenlee kredit kard at 34...stil hav it tudae as the 1 & oenlee.
(in kase yu wunder, hous kost 11,000$ at 5.25%, paement was 78$ & inkluded inshuer + hous taxes).
no pmi kauz it was fha, besides, me put down 20%.
& no, did NOT hav sterio (not invented yet) or TV, & the radio was in the 1 kar.
2. wi du yu hav 2 kars?
yu karree extravagans tu extreem.
3. YU LEFT YER WALLET IN THE KAR...yu R a akseedent waeting tu get mugged.
4. yu pae 29% on KK....no wot hoe-n-hed meen?
Sorry, it's really hard to understand what you are saying. I realize you do it on purpose, not sure why.
I have two cars because I moved from NJ to MI and I had just purchased my RWD Mercedes and the snow in MI is not RWD friendly. I tried to trade-in my Benz but since it was so new I was going to take about a $17,000 hit and I wasn't willing to do that. I picked up a cheap 4WD truck.
Yeah, I leave my wallet in the car quite a bit. If someone can break into my garage, break into my Mercedes, they sort of deserve my wallet. It's not a big deal, all my CC's have fraud protection, and I rarely carry cash as I use a debit card all day long.
As for the 29% card, like I said it was my first card that I got in College when I was 18. They never changed the rate on me and I rarely carry a ballance so I don't actually pay the 29%.
Erik
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Sat Jun 03, 2006 7:53 pm |
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Stock Mama
Full Member
Cash: $ 13.80
Posts: 68
Joined: 06 Apr 2006
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quote:
Originally posted by tifosiv122
Unfortunately, my first CC was a student card and still only has a $300 limit @ 29%. Eeek. I use this to pay for Netflix and stuff, generally paying it off each month. I guess after I pay down the others and start to close accounts I could ask for an increase as the newer ones have the $2-3,000 limits.
If the card is worth keeping -- if it has a low interest rate, for example -- call the bank and tell them that you're not a student any longer, and would it be possible to increase the credit limit? They probably will if your record of payments is good.
If there are no particular advantages to this card, and the second oldest one is better, close this one out.
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Sun Jun 04, 2006 11:16 pm |
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JCook
Full Member
Cash: $ 11.20
Posts: 56
Joined: 24 Jan 2006
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It is my opinion that you should use $9,000 to pay on the debts. Get rid of as many of them as you can. Keep about $1,000 just in case you need money for an emergency.
Pay off the rest of the credit card debt as fast as you can.
I think and have found through experience that you are much better off with as little debt possible. Zero debt would, of course, be the best.
This flies against what many will tell you now days but my experience has taught me to shun debt.
John
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Mon Jun 05, 2006 2:31 am |
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Rolo
Yo' Daddy
Cash: $ 309.70
Posts: 1551
Joined: 13 Mar 2005
Location: Colorado/Florida
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Pay off the BAD debt. BAD debt = high interest.
"Average age of accounts" = 10% of your FICO score. If you close your account, it still remains on your credit report, so you do not lose the history. Your student card is worthless, kill it. Keep your best 4-6 cards. Don't get the balances more than half of the credit limit.
Credit limit can affect your mortgage. For me, one lender assumed all of my credit cards were maxed for their loan amount calculation, the other didn't since all of my balances were zero. Obviously the former did not get my business and won't in the future. TALK to the loan officer...be frank and factual and they will be the same...their time is valuable also.
Get your credit reports...you get one free/year by law. Do you know what your scores are? Find out what it is and open your conversation with the loan officer with it.
Remember, FICO score determines your interest rate. Debt/income ratio determines loan amount.
"Expect me when you see me."
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Tue Jun 06, 2006 2:10 am |
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tifosiv122
New Member
Cash: $ 1.25
Posts: 6
Joined: 03 Jun 2006
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quote:
Originally posted by Rolo
Pay off the BAD debt. BAD debt = high interest.
"Average age of accounts" = 10% of your FICO score. If you close your account, it still remains on your credit report, so you do not lose the history. Your student card is worthless, kill it. Keep your best 4-6 cards. Don't get the balances more than half of the credit limit.
Credit limit can affect your mortgage. For me, one lender assumed all of my credit cards were maxed for their loan amount calculation, the other didn't since all of my balances were zero. Obviously the former did not get my business and won't in the future. TALK to the loan officer...be frank and factual and they will be the same...their time is valuable also.
Get your credit reports...you get one free/year by law. Do you know what your scores are? Find out what it is and open your conversation with the loan officer with it.
Remember, FICO score determines your interest rate. Debt/income ratio determines loan amount.
I got my credit report late last year / early this year, I don't remember which. It said I was good but had a high debt / salary ratio...could be because I have no income as I am a student now. That's why I figured instead of all this cash sitting in a checking account that I should just pay down the CCs. I still don't know my score because that wasn't free and honestly I didn't need it at the time so I didn't care.
Erik
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Tue Jun 06, 2006 2:19 am |
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Rolo
Yo' Daddy
Cash: $ 309.70
Posts: 1551
Joined: 13 Mar 2005
Location: Colorado/Florida
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Be sure to keep cash reserves.
"Expect me when you see me."
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Tue Jun 06, 2006 2:43 am |
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tifosiv122
New Member
Cash: $ 1.25
Posts: 6
Joined: 03 Jun 2006
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quote:
Originally posted by Rolo
Be sure to keep cash reserves.
I have no choice, school is $20+K a year, my apartment, etc. Since I'm not working I need to watch the cash that I have, which is where I came up with the $10K that I could easily pay towards my CC and not get into trouble.
I figured out last night I'm paying $500+ a month just in finance charges on my CCs...I never really realized it until I did the math. Ouch. What a waste of money.
Erik
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Tue Jun 06, 2006 3:15 am |
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