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Q: I have accrued $7,000 on credit cards with a total credit limit of $10,000. My interest rates average over 20%. My wife has $4,000 in debt on two cards with a total credit limit of $14,000, and her rates are 6% and 9%. Is it a good idea for me to transfer my high-rate debt onto her lower-rate cards, or should we not risk ruining her good credit scores?

A: Your wife’s great rates might not last if you transfer debt to her cards. Credit issuers get wary when consumers start to max out their cards, and may raise her rates. And using more than 30% of any card’s limit can hurt a borrower’s credit scores, the figures that lenders use to help gauge credit-worthiness.

You might try to ask your card issuers for lower rates, and you should work hard on paying those balances off.

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Categories : Credit & Debt, Q&A