Can I avoid score hit from consumer credit?

[Anonymous]

I need major ($15K or so) repairs to my house.  I will have to finance the work.  Because the the debt to credit ratio of the loan, of course, will be 100%.  Last time I did this -- on a $750,"90 days same as cash" tire purchase -- it dropped my score from 722 to 680-ish.  Score still hasn't recovered -- it's now at 719, despite doing everything "right." 

I did take a bit of a hit a year ago when I acquired three credit cards, but their overall acquisistion and use was necessary to get my score moving up.

There's no way to avoid this expense -- and, as shown by the tire purchase, it wouldn't matter if I took a low bid or a high one.  The consumer financing will be 100% of whatever the cost turns out to be.  

Any bright ideas out there?

[llecs]

The hit comes from the addition of a new account. Most lost 10+ points, depending on your avg. age. I lose an average of 20-25 points with each new account and tend to gain most of those point back within 6 month of it first being reported with the remainder within a year or so.

The damage is unavoidable, unless you save up and pay with cash first or stagger the work and use CCs and PIF right away (if not, you score will take a hit).

If you use CCs or a HELOC, the damage will remain up to the point where you pay it down or off. Othewise, for least damage, a bank loan is the only other option.

[Anonymous]

Why would a bank loan be preferable (from a score standpoint) from a consumer loan thru the contractor?

[llecs]

There is no difference if it reports. A contractor loan may not report which would be a plus, but you may have higher rates.

[Anonymous]

Thanks, Ilecs.  You're a peach,despite your scaly avatar . . .

As it turns out, the contractor loan is rate is only half a point higher than the bank, and is available for 120 months instead of 48, with no prepayment penalty.  Interesting.  I've been a very good customer of that bank for 27 years, reaffirming two loans with them through my (almost gone!) 1999 bankruptcy, and never a late payment on a small check overdraft account.