Received a loan with a high interest but have the chance to pay off credit cards - - help !

[TheCruiseMermaid]

Hello, this is my first post here. I've had relatively bad credit due to a bankruptcy filing back in 2015 (a decade ago) and have since been building my credit back up but unfortunately with cards that have annual fees or monthly fees, low credit limits etc. 

 

I realize the danger of having multiple credit cards but I do need them and enjoy having them as backup when my paycheck doesn't quite keep up with my expenditures. I'm an avid traveler and travel around 3x per year in which I incur most of my spending. I do have a full-time decent paying job but I am single so I only have "my" income to base everything off of.  

 

OVERVIEW: 

 

* I have 3 (THREE) $1,000 limits cards and they are currently almost to the max and I need to pay them off. (So not quite $3,000 but close to it).

* I have 2 (TWO) $850 limit cards and they are currently almost to the max and I need to pay them off as well. (So not quite $1,700 but close to it). 

 

(I have a few smaller limit ($300, $400 cards that I keep zeroed out most of the time).

 

I just got a $5,000 loan (not sure if I can say from whom but it is local in my town) that I used half of that to pay off a different loan I had for $2,500 that the interest just kept snowballing. This $5,000 loan has a payment of $239/month with a total of $1600'ish interest over 2 years I believe (not the best terms - but it doesn't seem the interest will just keep snowballing and never allow me to get out from under it at least that is what i think...)

 

I have come into a little money recently and have the opportunity now to PAY that $5,000 loan OFF since I just got it with only incurring around $40 in interest - is that what I should do ?  OR should I use this money to pay those credit cards above? And try to pay down that $5,000 loan each month at $239 ??

 

I just want to do the right thing ...

 

Please let me know any thoughts or advice you may have. 

[MarvBear]

Welcome to CreditBoards.

[swingline]

To figure this out, we would need to know the actual percentages of the cards, etc. One of the things people tend to do is think about what it costs in the moment versus the real cost. $1600 interest for two years on a $5k loan is nuts. And $239 x 24 months is $5736, which seems like $736 interest, not $1600. We would need actual values to sort this (loan amount, interest rate and fees. 

 

But the bottom line is that while you're still feeling like you're in a mess, you shouldn't be traveling. And moving debt from one place to another doesn't (usually) help much either unless you're getting 0% and a very low xfer rate. Especially since you will probably charge up those cards again. 

 

Come back with some hard values and we can look at it.