credit card question

Quote from tango29:

Reducing credit available hits your credit score.

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Yes. Because pretend nutmeg have for example $40,000 available credit to him (BEFORE) he close 2 chase cards he talking about.

Of this credit available, he have $10,000 in the debt for example.
In this time he have 25% utililization credit ratio, and is good because is below the 35%

(Now) nutmeg close 2 cards. With this 2 cards he take away for example $20,000 of the available credit.

Now the calculation is nutmeg have $10,000 debt in the ratio to $20,000 available credit. That is 50% nutmeg use of the all credit available. That is high, and will make his FICO score go down.
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Quote from Banjo:

I'm pretty sure Chase has a guy that reads the ET joke thread and some of yours are pretty shitty.
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Hi Jamie (just in case he reading this)

gr.gif
 
Quote from nutmeg:

Now I just have to figure out if I want to do this or not. Sounds tempting on the reduced interest rate, though. [/B]
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Yes. If you have too big of debt with high interest rate, (you are only paying minimum?) sometimes is better to take the lower interest, y make (MORE) than minimum payment, to reduce your debt. With the 2 cards closed, you are not adding more, you are paying down. So in time the utilization ratio will be good again, then the FICO is coming up again.

Nutmeg, I try to build credit and I have one only card with rewards! So I always pay in full every month. So; no interest/build credit/have rewards points in cash. I do this for one year now, and I redeem the rewards for $429.00 cash.
 
Thanks again for the replies. I ran the numbers and the effect on utilization rates and the trade off is basically losing the remaining credit ava vs a lower interest rate.

I suppose if I wanted to pursue this further I could look for zero balance transfers, but for the moment I'm going to leave it all as it is.
 
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