- Posts: 1
- Joined: Wed Feb 02, 2011 11:55 pm
- Location: ct
Ok long story made short-
i flip houses and just finished a place that took a ton of money (about $135k) to fix up. about $60k of that was financed with credit cards. most of the cards i took out at the start of the project, so they are, or were up until last couple months, 0% interest. it ended up working out great. ill be closing on the sale of the house next week, and ill be paying off all the credit cards completely. yes, my credit took a big hit, but it is only temporary.
ive done the identical thing a few years ago. my credit was about 730, i filled up a ton of cards for a few months, it plummeted to 650, then i payed them off when the project was done and it spiked to 755 a month or two later. this is all normal and expected of course.
normally, immediately after i close on the house, i would just pay off all the cards in full. the questions come in at this point, because i have a realtor friend that claims if i pay off the entire balance on each card all at once, it will not be as helpful to my credit score as if i paid them off over a period of 3 or 4 months, sending payments of like 1/3 of the balance each month. like 50% of what this guy says is crap, but i know credit score mechanisms can be finicky, and he swears up and down on this, so he could be right. if he is right, then i can essentially buy 15 or 20 points on my credit score for $200 worth of interest payments. that is something ill gladly do.
so is paying off the balances over 3-4 months better for my score than paying them off all in a day? and please no speculation on this, only reply if you have some solid info.