paying loans vs Credit cards
Date: Thu, 04/23/2009 - 17:34
Look at the interest rates in comparison for both. A useful too
Look at the interest rates in comparison for both. A useful tool is googling 'financial calculators' You will find a helpful site that will help you break down the savings you will have and do a 'what-if' scenerio to compare both.
Also consider that it takes the credit reporting companies up to 90 days to reflect your accurate credit score and a paid off loan, if you plan to buy this summer I would consider continuing to pay the cc monthly, preferably more than the minimum payment and get those paid down. Most CC's report monthly to the credit reporting companies. To help build your score over time you have to continue making monthly payments to cc to prove that you can budget your money (even if you could pay the cc off in one payment) For example I am sitting on a balance of $123.00 on a credit card and making a $20 payment monthly (the minimum is $10) to help build my score. I would love to just pay it off in one whack and be done with it, but showing I can budget and make the payment on time each month with help build my score.
Last thing. . .if you have had collections on your report they may ask for a co-signer for the car loan, are you prepared for that?
Good luck and remember don't get burned with too high of an interest rate on this car shop around!