Using balance transfer to pay credit card
#1
Using balance transfer to pay credit card
Is this going to hurt my credit score?
I've taken a 'balance transfer' offer and used it to put cash into my checking account. Then I paid off a different credit card with some of the cash from my checking account.
I've taken a 'balance transfer' offer and used it to put cash into my checking account. Then I paid off a different credit card with some of the cash from my checking account.
#2
Forum Regular
Joined: Dec 2007
Location: Suburban Houston, TX
Posts: 246
Re: Using balance transfer to pay credit card
If you zeroed the other card out and keep it that way, it should all even itself out. But it does depend on the credit available on each card and the balance you are carrying.
#3
Re: Using balance transfer to pay credit card
I do it all the time. Esp when the one company is offeringa really good interest rate (say 0% for a yr, or 3.99% for the life of the xfer). Never hurt my credit, and I've been doing it for 10 years. My credit is well into the mid to upper 700s. I wouldn't necessarily go ahead and close the the first card though, until I have paid enough down on the new card, to prevent what Steve pointed out.
#4
Re: Using balance transfer to pay credit card
OK, phew. Thanks for your replies. I was a bit worried about it as I've heard people mention 'using credit to pay credit' as a bad thing. (Clearly it's a bad thing for your sanity if you are relying on it to get by each month.)
I did zero out the balance on the 2nd card. The card I took the transfer offer on had a zero balance already and the transfer amount I took is 1/5th of the available credit. I should be able to pay it back in 2 months.
I did zero out the balance on the 2nd card. The card I took the transfer offer on had a zero balance already and the transfer amount I took is 1/5th of the available credit. I should be able to pay it back in 2 months.
#5
Joined: Jan 2008
Posts: 7,605
Re: Using balance transfer to pay credit card
You should be fine, then. 10% util is the Holy Grail for FICO, but the alarm bells don't start to ring until 25%.
#6
Re: Using balance transfer to pay credit card
Will be paying it off the folowing month, but takes us so close to the limit as it only just covers the cost of two return tickates.
will that affect my credit rating with FICO then? And what about the other credit agency people? still working on our score but currently in high 600's.
Last edited by Chrissywissy100; Feb 22nd 2009 at 2:14 am.
#7
Joined: Jan 2008
Posts: 7,605
Re: Using balance transfer to pay credit card
Short answer - yes. Your FICO score is based on a number of factors. One of these is "utilization" - amount of debt as a percentage of available credit.
AIUI, there are two sub-measures - total utilization and utilization per card. Total U is the big one - as others have said, if you have enough available on other cards to dwarf the balance on one card then the effect should be small.
To an extent, though, we're guessing as Fair Isaac keep the algorithms secret. A good place to learn more is creditboards.com
AIUI, there are two sub-measures - total utilization and utilization per card. Total U is the big one - as others have said, if you have enough available on other cards to dwarf the balance on one card then the effect should be small.
To an extent, though, we're guessing as Fair Isaac keep the algorithms secret. A good place to learn more is creditboards.com
#8
Re: Using balance transfer to pay credit card
Short answer - yes. Your FICO score is based on a number of factors. One of these is "utilization" - amount of debt as a percentage of available credit.
AIUI, there are two sub-measures - total utilization and utilization per card. Total U is the big one - as others have said, if you have enough available on other cards to dwarf the balance on one card then the effect should be small.
To an extent, though, we're guessing as Fair Isaac keep the algorithms secret. A good place to learn more is creditboards.com
AIUI, there are two sub-measures - total utilization and utilization per card. Total U is the big one - as others have said, if you have enough available on other cards to dwarf the balance on one card then the effect should be small.
To an extent, though, we're guessing as Fair Isaac keep the algorithms secret. A good place to learn more is creditboards.com
I think I make too many assumptions on how things work in this country! Really should look into these things more shouldnt i!! I'll look at creditboards.. thanks!
#9
Re: Using balance transfer to pay credit card
~ Jenney
#10
Re: Using balance transfer to pay credit card
It was on an existing card that I've had since 2001. What's the difference?
#11
Re: Using balance transfer to pay credit card
~ Jenney