I have 2 credit cards from Capital One and Discover. As a college student I have only $500 of credit line for each card, which totals to $1,000. On one of my cards I have $465 used credit which means only $35 is available. That card was near-maxed out for the past 2 months. On the other card I have $105 used credit, which means $395 of credit is available. I've only had this card for 2 weeks. I am going to receive my $168 paycheck this weekend and was wondering if I should just pay my card that has a balance of $105 to clear it up to $500 of available credit and used the leftover for my credit card with $465 balance. Which one is better? Pay off the credit card first thats been going on for months? OR pay off the credit card that has been used lightly making it have $0 balance? Which one of these would increase my credit score better in the future?
First, a credit score is a how much debt do I have score. Using your cards to increase you credit score is leading yourself into a path of debt for the rest of your life. I suggest you pay off the smallest and work as hard as possible to pay off the other one and cut them up. If you can't buy what you need for cash, you don't need it. Do you really want to start your life in debt?
Not necessarily. If you have a credit card always sitting at a balance of 0, that doesn't increase your credit rating at all... since you aren't really using credit. Credit card companies want you to hold a balance. Making payments on time is a way to increase credit rating. I'd pay off some of hte other one.
pay off the credit card that has the most balance, as too much balance on a credit card will reduce your score. anything more than 50% debt on the credit card will lower score.