Payment Order
by Scott Bilker |
Scott,
I have 3 credit cards with a total debt of $25000. I
am paying $950 a month (double the minimum amt due). Should I repay
the highest interest card off first, or should I repay the lowest
interest card off first and transfer the balance from the higher
interest card?
--Nadiyah
Answer
Nadiyah,
Always, always, always, pay the highest interest rate first. Paying
in any other order will definitely cost more money.
I have heard many "experts" suggest to pay the shortest
term loans first or the lowest balance cards first but they're
wrong, absolutely wrong!
Pay the highest rates first.
I guess you can tell that I really want to get that point across.
Also, if you can you should transfer from the high rate card to the
low rate card. Be careful to make sure, by calling the bank first,
that you will get the low rate when you do the transfer. Sometimes
the transfer rate may be greater than your current low rate.
By the way, great question!
Talk to you later.
Great to hear that you're able to pay off the debt--keep up the good
work!
Scott
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