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So FYI I did not see any major jump in score at all - also I am in porcess of qualifying for mortgage and my lender used a simulator tool that outlines "what if" scenarios and she said that this type of CD INSTALLMENT LOAN is not reported as REVOLVING CREDIT so does nothing for your score. But in any case I will have a CD in the end.
It has nothing to do with revolving credit.. it has all to do with Credit MIX....
How long have you had it for... barring you have no other installment loans it has to be paid off to a certain percentage before youd notice a difference... But your already in the morgage process so you may not be able to visibly see the results.. and it will be moot after you get the mortgage because it will take over in the credit mix....and youll take a hit for that...
She said it does nothing to raise score. Please elaborate, because I signed up with that understanding.
@Anonymous wrote:She said it does nothing to raise score. Please elaborate, because I signed up with that understanding.
If you already have an installment loan on your reports, open, this doesn’t do anything for your score but add another positive score. It helps the most whe you’ve never had an installment loan before. It adds to the different types of loans on your report. Examples are revolvers (credit cards, Hellocs), Installments (personal, car. School, home loans) and other (SSA overpayments etc) but to get the full extra points the loan needs to be at 8.8% or less of its original loan amount.
So the loan loan may add points in credit mix and positive accounts total. No one can say the exact amount of points it may add, but in the right newer profile circumstances it could be from 5 to 30 points maybe. In your case if you have other installment loans open or closed on your profile it may not affect your score much at all. Just depends on all the accounts in your report.
Vantage Scores are completely meaningless.
You might see a small boost if you have no installment loans currently, perhaps 15 points.
I like the idea of it- long-term a few years of positive payment history always helps.
Nothing unique about their service, other than you not needing $500 upfront to get the secured loan. Also, you can’t use the “loan”- the payments you make just go into the required $500 savings account. Interesting setup to force a person to save money.