If you’re looking to improve your credit score quickly, paying down credit cards with balances closest to their respective credit limits can give you the boost you need. Ideally, you want to get your balances under 30% of the credit limit, but even getting them under 50% can make a difference. Once you’ve done this, you can request a rapid rescore from one of the major credit bureaus (Equifax, TransUnion, or Experian), and they’ll recalculate your score based on your new balances.
If paying down your balances to 30% is not feasible, you may want to consider spreading the debt around to other cards to keep the balances under the 30% threshold. However, be cautious when using credit cards to pay down other credit cards, as this can become a costly cycle of debt.
It’s important to note that if you pay off a credit card completely, do not close the account. Doing so can actually cause your credit score to drop! Think of your credit report as a resume; it lists your past accomplishments in terms of how well you handle past debt obligations. If you remove some of these accomplishments by closing out your accounts, it could hurt your chances of being accepted for future loans or credit cards.
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