If you have a thousand dollars split between six credit cards how will your credit score be affected by consolidating the debt to one or two accounts if they will be maxed out when you do it? |
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Answer
It will hurt your score. Try to keep all cards below 35% of each card's maximum limit. 35% is the magic number that lenders like to see you under. If you consolidate everything to one card, that brings the card above 35%. If that one card is a very low interest rate compared to the others, you have to make the choice:
- pay less interest but take a credit score hit
- pay more interest but keep all the cards below 35%
If you are planning to ask for a loan soon, I'd keep them all distributed evenly. If you aren't going to need a loan soon, I'd consolidate and work hard to pay that card off quickly.
First answer by Thomaszabel. Last edit by Thomaszabel. Contributor trust: 31 [recommend contributor]. Question popularity: 13 [recommend question]
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