New Contributor
Posts: 55
Registered: ‎11-25-2011

Auto Loan | Reporting Schedule?

I just put $20,000 on my auto loan to pay it off entirely. This payment (cashiers check) was submitted to the credit union's branch office on 12/17. However, my normal payment schedule is on the 1st of every month. So, two questions...


  1. Does auto loan reporting work the same way as a credit card would? In other words, will I need to wait a few days after January 1st for the change to show?
  2. How is this change likely to affect my credit score? From my understanding, it won't do much for my score, but it will help me get a mortgage loan next month (proof that a car payment won't take away from my income). Is this a correct assessment?

One other quick note: the car loan is only 7 months old, so in theory, I guess paying it off could potentially negate the negative effect that a "new account" has on your score? Since that new account is no longer in question.



Valued Contributor
Posts: 3,406
Registered: ‎12-19-2012

Re: Auto Loan | Reporting Schedule?

1) yes, it takes a few days for the lender to report the account closed and show the balance paid in full.

2) paying off the auto loan will help in getting a mortgage as your debt to income ratio is lower. However because it is now a closed account and you have no other auto loans reporting, you will lose diversification and your score will probably drop some initially.

Do you have other open trade lines reporting? This is important for your credit score to go up. Also be sure you are not hovering around the minimum score requirement for the mortgage as a drop in score from the closed auto loan could hinder pre approval for the mortgage.
Cards: Orchard Bank ($1100) | Cap1 Cash Rewards ($2500) | Chase Freedom ($1000) | Best Buy ($2500) | Discover It ($1000) | Barclay Rewards ($2500) | Current scores: EX FAKO: 684, CK TU: 649, FICO EQ: 680, FICO TU: 698, FICO EX: 658 Happy Homeowner Since 2/6/13! :smileyhappy: Last App: 4/5/13 Gardening until July 2014

Copyright ©2001-2015 Fair Isaac Corporation. All rights reserved.   | Terms of Use | Privacy Policy | Sitemap

IMPORTANT INFORMATION: All FICO® Score products made available on include a FICO® Score 8, along with additional FICO® Score versions based on Experian or Equifax data (additional FICO® Score versions based on TransUnion data are not currently available on Your lender or insurer may use a different FICO® Score than the versions you receive from myFICO, or another type of credit score altogether. Learn more

FICO, myFICO, Score Watch, The score lenders use, and The Score That Matters are trademarks or registered trademarks of Fair Isaac Corporation. Equifax Credit Report is a trademark of Equifax, Inc. and its affiliated companies. Many factors affect your FICO Score and the interest rates you may receive. Fair Isaac is not a credit repair organization as defined under federal or state law, including the Credit Repair Organizations Act. Fair Isaac does not provide "credit repair" services or advice or assistance regarding "rebuilding" or "improving" your credit record, credit history or credit rating. FTC's website on credit.