Mixing different kinds of credit

[nicemann]

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laniepr787 wrote:

I do have a checking and savings account at a credit union so I could try applying for a small loan. Would it be a good idea to get a loan, and pay it back with the same money...It would be strictly for building credit..

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So how much of a loan would one need to take out to make a difference on your CR.  Also wouldn't it hurt it at first?  Any certain amount of time that is needed to stay open?  I have been debating about doing this myself.

[Anonymous]

The amount is not as important -

12 months+ is best-  

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nicemann wrote:

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laniepr787 wrote:

I do have a checking and savings account at a credit union so I could try applying for a small loan. Would it be a good idea to get a loan, and pay it back with the same money...It would be strictly for building credit..

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So how much of a loan would one need to take out to make a difference on your CR.  Also wouldn't it hurt it at first?  Any certain amount of time that is needed to stay open?  I have been debating about doing this myself.

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[nicemann]

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Timothy wrote:

The amount is not as important -

12 months+ is best-  

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Guess I will wait about 30 days and see what my credit score looks like.  Almost all of my Baddys should be off by then.  Then maybe I will see what kind of interest rate I could get for $2000 - $3000 loan or so.  Don't need the cash just want to have it on my credit report.

[haulingthescoreup]

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@Anonymous wrote:

Timothy You missed the point of my post. I know that a CFL is an installment. My point was that even if the 2 companies mentioned by LS and HTSU have CFL's that they also have regular accounts, and should not be automatically assumed that an account with them would be a cfl. I do not know if either of those companies offer cfl's. If they do one would need to ask how the account would report rather than assume that it is a cfl.

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Good point! I will be sure to mention that these companies offer both revolving and installment products. I know for a fact though that my Wells Fargo Financial loan was scored as an installment loan, not as revolving, and as best as I can tell, it was a CFL. I think it's a stupid scoring distinction, and unlike others, I have nothing but good things to say about WF. An offer came in the mail, it allowed me to pay off a huge tuition charge that I had to put on my CC, and I was able to pay off the loan in 10 months instead of 3 years. I had no idea that it could be a negative on my credit report. (Of course, back then, I was only vaguely aware that I even had a credit report!)

My understanding of a revolving product is one where you can keep "going back to the well." So if you originally were given credit for $2,000, and you keep paying it down with regularly scheduled payments, but you can't borrow again against that $2,000, then it's installment. Whereas if you're approved for $2,000, and you keep paying it down with regularly scheduled payments, and once you've paid off $1,200, you can go borrow up to $800 again, it's revolving.

Credit products have gotten so blurred these days, as with HELOC's, I can well imagine that there are hybrids now. So cowpaddi is right, always ask before borrowing how it will be reported --revolving or credit. And hope that your CSR knows what s/he is talking about!

[Anonymous]

HTSU I agree with your assesment of the differences between revolving and installment loans. However since cfl's are coded as installment loans, how does one tell the difference between a good installment loan and a cfl?  I know that a cfl has a negative impact on our scores, but how can we tell which is which when looking at our reports?