To Combine or not to combine....

iVillage Member
Registered: 10-18-2008
To Combine or not to combine....
11
Fri, 10-31-2008 - 1:42pm

I need to hear from you guys what you think about combining my cc

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iVillage Member
Registered: 01-25-2006
Fri, 10-31-2008 - 1:53pm

I'm a little confused but let me see if I can offer some thoughts:

1. There are reasons to consider leaving the balances where they are but it's not because having a balance on them helps your credit score. What might weigh in on your score is your percentage of available credit in use. So if you dump all of your balance onto 2 cards causing say 80% utilization of the available credit on those the thinking is that it would be better to have 4 cards with 40% utilization. I personally wouldn't worry about that unless you have intent to do a car loan or mortgage before you can get the 2 cards paid down significantly. Credit scores are very fluid and if the sanity gained by only 2 bills is significant along with reduced interest costs, it very well may be worth the temporary hit. DO NOT close the other accounts however.

2. I'm not sure why you are trying to lower the apr on the cards you pay off. Are you thinking you might be able to float the other balances back over there after a lowered apr? Depending on your amount of debt, you might pay quite a bit in transaction fees so unless the interest was significantly different, I wouldn't mess with it. The apr on my cards usually doesn't change when I pay them off but they often will send me new and better balance transfer options when I pay them off. If you are looking to lower the apr so you can use the cards for future purchases, I STRONGLY encourage you to stop and think that one through. If the apr is a built in discouragement for using the cards, I would leave it where it's at. Giving yourself a more attractive 'out' is usually not a good plan and you very well may find yourself with 4 cards with a big balance eventually with that.

HTH!

Peg

iVillage Member
Registered: 10-18-2008
Fri, 10-31-2008 - 2:04pm

That's a good point, especially since we already have the history of the second mortgage to pay off debts, then run the cc's back up within 2 years.


I don't know why I am stuck on the apr.....no, I don't intend to go back out and use them, therefore it wouldn't matter what the apr is if it's not being used....I think I'll have to have a little therapy for that thought......hahahah


I guess I'm primarily thinking about how many envelopes I open each month....I think I may just go with the status quo at least until January.

Avatar for cl_phocid
iVillage Member
Registered: 03-26-2003
Fri, 10-31-2008 - 3:33pm
DH and I merged and combined whenever we could.

All my best,
Danni

iVillage Member
Registered: 06-10-2008
Fri, 10-31-2008 - 4:08pm

Everyone's situation is different, so it depends on what you plan to do with your credit/loans/etc in the future.

iVillage Member
Registered: 03-17-2003
Fri, 10-31-2008 - 4:15pm

Restructuring your credit card debt so it's combined and/or balance transferred to 0% or low interest debt is always smart.

iVillage Member
Registered: 10-18-2008
Fri, 10-31-2008 - 4:31pm
What if there is not quite enough to transfer the entire amount?
iVillage Member
Registered: 03-17-2003
Fri, 10-31-2008 - 4:38pm

I would do precisely that: restructure all the debt you can and what you can't park on low interest rates are targeted to pay off ASAP.

iVillage Member
Registered: 01-25-2006
Fri, 10-31-2008 - 5:23pm

I will caution you however not to run your two lower apr cards right up to their limit. You want to leave some breathing room in there so that if some snafu happens with your payment that fees and interest do not run you over your credit limit and then start accruing over limit fees and lots of ugly stuff. I personally would avoid using over 90% of an approved credit but if the approved credit was very low, that might not be a big enough buffer. An overlimit charge is probably $35-50 and so are late fees.

Peg

iVillage Member
Registered: 11-17-2007
Fri, 10-31-2008 - 7:16pm

I am a big believer in transferring debt If

iVillage Member
Registered: 10-18-2008
Fri, 10-31-2008 - 9:31pm

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