If you are planning to apply for a mortgage, or some other large loan, it may well be smart to pay off much or all of your credit card debt. The lower your credit card balance, the lower the interest rate for that mortgage. That’s because the amount of that balance accounts for 30 percent of your FICO score.
Lenders take those scores seriously. If your credit card balances are too high, the lender may deny you a mortgage altogether.