Installment loan util decrease?

[Anonymous]

I have a student loan I recently made my first payment to. I got a balance decrease credit change alert on Feb 5th from EQ, and in the alert it said my util went from 137% to 130% then on Feb 8th I had an inquiry alert which also notified me of a 1 pt increase, then Feb 9th another inq alert which notified me of a 5 pt increase. Could those increases be from the balance decrease/utilization dropping in the loan? Nothing else about my credit had changed, other than the inquiries (auto loan shopping). I wasn't under the impression installment loan utilization mattered, or maybe it's bc I mostly read about credit card utilization.

[Anonymous]

I have 2 CU loans. one of them reports strangely to TU, basically it is showing as revolving on my TU report, as installment on EQ and EX. So TU gives me updates on balance changes (and score increases as I pay it down). You may be experiencing the same thing, or you are just gaining the points from the OK's from the payments on that loan.

[Anonymous]

The loan has been in good standing since 2008 with a few lates a few years ago from forgetting to reapply for forebearances. I just started paying on it though last month, made a $90 payment then got the alert about the balance/util decrease and a couple days later 6pt increase. Wasn't sure if paying the loan down was why.

[gdale6]

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@Anonymous wrote:

I have a student loan I recently made my first payment to. I got a balance decrease credit change alert on Feb 5th from EQ, and in the alert it said my util went from 137% to 130% then on Feb 8th I had an inquiry alert which also notified me of a 1 pt increase, then Feb 9th another inq alert which notified me of a 5 pt increase. Could those increases be from the balance decrease/utilization dropping in the loan? Nothing else about my credit had changed, other than the inquiries (auto loan shopping). I wasn't under the impression installment loan utilization mattered, or maybe it's bc I mostly read about credit card utilization.

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SLs should have no effect on revolving util percentages, I have seen this util on personal loans before, I would just ignore it has nothing to do with the 30% pie of Fico thats calulated off revolving cards. An inquiry rarely results in a score increase unless you had none on file to begin with then it will boost the new credit section of the fico pie. Paying down balance on instalments over time does raise Fico score.

[Anonymous]

I would attribute these minor bumps to aging of items on your files, most likely. All other things being equal, you scores tend to rise over time from aging of both positive accounts and derogs.

[RobertEG]

Scoring of installment loans in the category of util is based on the percent remaining of original loan balance, and is not a "percent utilication," which is your utiliization of your authrorized credit limit.  The remaining balance of an installment loan is not scored highly, as any installment loan would automaticially have a high remaining balance in the first months of life.  It is s fact of life rather than a representation of the consumer's discretionary behavior.

Dont think of installment loans as having a % utiliization.

A slight wrinkle occurs in the case of a line of credit, which is actually revolving credit, that has a high credit limit of around 35K or more.

FICO scores those as installments, gving them substantially less impact than a CC at the same credit limit.