Effect of installment loan on my credit score

[Anonymous]

Just got a secured installment loan from my credit union. $1,000 over 12 months. All three scores have now updated. Equifax went down 3 points, Transunion down 1 point and Experian went up 7.

Seems like they make it up!

[Shiva78]

Just had 4 defaulted student loans consolidated into one to create a positive TL.  Showing 1 month of payment history so far.

EQ went down 7 points.  Waiting for TU and EX to update.

[Anonymous]

I haven't got a payment history on it yet. I made a payment but the loan hadn't posted to my credit report at the time. I actually made a payment before I needed to. I'm staying one month ahead just in case anything comes up.

Good luck with your credit scores. It's frustrating seeing that drop but good to know it will go back up and then some.

[Anonymous]

Congrats on adding an installment "loan".

I'm about to go get me more installment "loans" but I am going for 60 months ... if I am going to take the AAoA hit and the inquiry, I might as well make the loan last as long as possible.  

I haven't seen a score go up because of an installment loan that fast.  You usually take a hit across the board but you got 7 points on TU, nice.  

[alienfico]

Funny thing about installment loans, mine have been paid religiously through automatic deduction and I swear as soon as the payment hits and the balance decreases I lose points.  I have no clue as to why that is happing.  I just logged onto myFico account and saw a 12 point decrease just because my balance on one loan went from 70% to 63%.  This drop is so random when all I'm doing is paying my bills on time.  Go figure  

[Anonymous]

Thanks. I think I may go for a longer loan next time what you said does make sense. Although I am hoping to qualify for a HELOC/HEL or some other loan on my house in 2015 so that should take care of my credit mix. It was odd too that I didn't take a hit for hard pulls I had recently. Had two and neither one affected my score. Had a collections account from a 2010 charge off added recently too and that didn't change anything. It's so hard to work out what will impact and what wont. Even by FICO's own reckoning that doesn't make sense.

[Anonymous]

---

@alienfico wrote:

Funny thing about installment loans, mine have been paid religiously through automatic deduction and I swear as soon as the payment hits and the balance decreases I lose points.  I have no clue as to why that is happing.  I just logged onto myFico account and saw a 12 point decrease just because my balance on one loan went from 70% to 63%.  This drop is so random when all I'm doing is paying my bills on time.  Go figure  

---

Sorry to hear you had a drop. As you can see from  my post above FICO scores make no sense really.

[Anonymous]

An installment loan just posted onto my TU profile today and my score dropped by 4 points. 

I assume it's a combination of my AAoA dropping and new debt being incurred (I have four other installment loans active at the moment; most of which will be paid off soon, but I can't imagine adding a fifth installment loan would really help in terms of having "different types of debt").  

I would guess that your score will actually go up in the long run, with the addition of this installment loan.