I'm not sure what you mean by the oldest debts reaching their maximum penalty. What types of loans do you have? Are you current on any of them? These are important questions, and your answers could change my thinking on this topic. Assuming you are not able to pay all the loans at one time, I would lean toward paying off the smallest balances first. This does several things. One, it clears out some of the balances quickly, which will begin the process of rebuilding your credit. Two, it frees up the cash from those monthly payments, assuming you are making payments at all. And three, it will give you a boost having accomplished a small amount of debt payment. That said, paying off the oldest will be more preferable to get it off your record quicker. But, if paying off the oldest first means you have to default on newer debts, I might change my thinking. More information from you would be extremely helpful, and you would do well to have a specific plan created to get through this debt payment and work toward not repeating it in the future.
WalletHub Answers is a free service that helps consumers access financial information. Information on WalletHub Answers is provided “as is” and should not be considered financial, legal or investment advice. WalletHub is not a financial advisor, law firm, “lawyer referral service,” or a substitute for a financial advisor, attorney, or law firm. You may want to hire a professional before making any decision. WalletHub does not endorse any particular contributors and cannot guarantee the quality or reliability of any information posted. The helpfulness of a financial advisor's answer is not indicative of future advisor performance.
WalletHub members have a wealth of knowledge to share, and we encourage everyone to do so while respecting our content guidelines. Please keep in mind that editorial and user-generated content on this page is not reviewed or otherwise endorsed by any financial institution. In addition, it is not a financial institution’s responsibility to ensure all posts and questions are answered.
Ad Disclosure: Certain offers that appear on this site originate from paying advertisers, and this will be noted on an offer’s details page using the designation "Sponsored", where applicable. Advertising may impact how and where products appear on this site (including, for example, the order in which they appear). At WalletHub we try to present a wide array of offers, but our offers do not represent all financial services companies or products.