In March of this year, I shared how our credit score plummeted from 748 to 618 last year.
This last month, I paid off the three largest balance transfers that we made during our bank bonus, credit card bonus and stoozing spree. We had borrowed between $11,000 to $13,000 from each card and the May payment represents approximately two thirds of our entire balance transfer cash. We still have about one third of the money that we borrowed at the 0% APR introductory offer and stashed in a savings account. Unfortunately, the interest rates on savings accounts have come down a lot over the last year. In 2007, it was easy to find online savings accounts at over 6.00% APR, now our money is only earning 3.25% APR at FNBO Direct.
While we enjoyed and needed the extra interest that we earned every month, I was surprised at the sense of euphoria that came with paying off the balances. There is a relief that comes with being out from under the debt even though it was kind of a “fake” debt in the first place since always had the cash on hand and could pay it off at any time. My stress level has eased and even though our balance transfer arbitrage was successful, I don’t plan to do it again any time soon.
Hopefully we don’t have to.
Our credit score has also fully recovered – I checked two weeks ago and it was at 758. Last night I discovered it had zoomed to an incredible 800! It is important to note that the only score I can check for free is a TransUnion score through Credit Karma. TU is generally considered to be 30 to 50 points on the high side. Even if you make an adjustment for a TransUnion number, it is still the highest credit score that I have ever had. We will be paying off the rest of our credit balance as the introductory APR’s expire, so our score will continue to rise – and if we could sell our house in Wisconsin right now, we will be in great shape to buy a home here in Colorado.
Here’s hoping. . .