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Installments loans, good or bad?

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Frequent Contributor

Installments loans, good or bad?

I've read several post on here where several people state that installment loans don't do much for your CS. Installment loans are all I have reporting good for me on my CR. I do have two new CC's that should start reporting soon but other than that I've got nothing else good going for me. So if installment loans aren't helping my score then all I have are a couple of very low CL CC's. One of my installment loans is an auto but I suppose that doesn't make a difference if its simply reporting as an installment loan if I'm understanding everyone's post correctly. What do CC's show up on report as? Apparently these are the only thing that's going to do anything for my scores other that the installments adding to my AAoA. Is there another type of credit that I need to be trying to acquire to give my scores a maximum boost? Surely credit gurus use more than just CC's to achieve high achiever status.

Thanks in advance.
3 REPLIES
Frequent Contributor

Re: Installments loans, good or bad?

Bump
Epic Contributor

Re: Installments loans, good or bad?

Installlment loans, when open, add to your credit mix which is 10% of your score.  After they are closed they still factor into your AAoA.  These loans have their own utilization which is probably less than 10% of your score.  If you default on an installment loan they do hurt you just as much as anything else.

 

CC is a revolving account.

 

If you haven't seen this, here is a look at how your different accounts, payment history and all that is looked at.  It is general information from FICO:

 

http://www.myfico.com/crediteducation/whatsinyourscore.aspx

Frequent Contributor

Re: Installments loans, good or bad?

Thanks Guiness, that's exactly what I needed. No I hadn't seen that before.