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spritezero

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Opinions, please, on the order in which I should do these three things...
Hello,

I am deciding how to stage the following three moves to best influence my FICO score and to accomplish the two applications for credit I will be looking for. Apologies if it rambles on a bit.

1. Paying off my credit card debt of $5000.00 (across 8 cards - balances from $80 to $950)
2. Applying for AAdvantage Citi card b/c of the very high bonus miles (60K) which I want for overseas travel next summer
3. Possible new car loan of approx. $18,000.

I currently have an Equifax score of 706 (Credit Karma - 677). I've raised my score about 100 pts in 18 months and I think that's good progress. I carry about $5000.00 in credit card debt. Due to a coming influx of cash I will be able to pay off the debt in full (if indeed that's the best thing to do) in about 2 months. It seems obvious this is the first thing to do. Equifax's credit simulator predicts a score of 786-820 after paying off my CC debt.

I am unsure about the order I should do the other two. Apply for the card I want first or a new car loan (would be about $18,000) first. Which would be a better idea to do first to assure acceptance for both?

I will also have the option of just buying the car for cash. With financing I would have interest, of course and some sort of affect on my credit score - good or bad? With a cash purchase I would save a bit on car insurance and be able to keep that lump of cash liquid in case of emergency.

Any advice on the best sequence of these things would be greatly appreciated. Thanks.

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Also, your last paragraph states you have the option to pay cash for the car. If so, go ahead. That would be far better than financing it, you would save hundreds of dollars by avoiding the interest.

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I think you have the correct order, paying off the debt is definitely number 1, as for the other two, it would be your choice whether you want  the credit card first or a car loan. Which ever one you chose to do first wait about 6 months in between because you may get approved for the credit card, but not the car loan (vice versa) if you apply for both around the same time.

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Your order is right. Keep loan last.

Your order of doing things is right. As far as whether to go for loan or credit card first, I would say credit card. The reason being, credit card approval criteria is higher than other loans (because it is an insecure debt). When you have paid off all debt and have no open installment loans on your credit file, you will get the BEST OFFER for a credit card approval as you have no obligations (means, lowest interest rates, highest credit limits, best benefits). Getting a loan afterwards should not be very difficult.

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