Reply
Regular Contributor
Posts: 173
Registered: ‎09-10-2013
0

Is this the right thing to do?

Today I was approved for a loan that will pay off a small existing installment loan, the remaining 4 collections that are my credit report, and pay off all 3 of my credit cards and fingerhut completely.

I should take the loan, right?
Community Leader
Senior Contributor
Posts: 26,822
Registered: ‎02-07-2013
0

Re: Is this the right thing to do?

Only you can answer this 

1) If it benefits you of course use the credit 

2) If you think the rates or it will be to costly walk away

3) Have you offered PFD's for the collections or are you just using the loan to pay in full? 

Offering PFD's may reduce the loan amount IMHO



+ Chase Ink =

Valued Contributor
Posts: 1,063
Registered: ‎07-09-2013
0

Re: Is this the right thing to do?


myjourney wrote:

Only you can answer this 

1) If it benefits you of course use the credit 

2) If you think the rates or it will be to costly walk away

3) Have you offered PFD's for the collections or are you just using the loan to pay in full? 

Offering PFD's may reduce the loan amount IMHO


4) Can you resist the urge to get back into the same trouble?


   3/12 $3500     6/12 $1200      10/12 $1500   12/12 $3400    6/13 $12000      7/13 $5000      7/13 $2500       8/13 $2000    8/13 $6000

  | CSP (AU) $12,000 | Amex PRG (AU) | United $6,000 | OCCU $12,000 | Ink Bold | GM $3,200 | DCU $7500 | Luthansa $9000 | SPG $6,000 | Citi AA Executive $11,000 | Ink Plus $5,000                                                                         | EX 2/7 697 | EQ 10/27 721 | TU 12/15 719 |

Valued Contributor
Posts: 1,884
Registered: ‎10-24-2013
0

Re: Is this the right thing to do?

would the loan end up saving you more than it cost you?

the beatings will continue until moral improves Wal-Mart lowes, quicksilver, nasa, forum, Indiana members, nfcu, Barclay, upromise, Barclay arrival plus
Regular Contributor
Posts: 173
Registered: ‎09-10-2013
0

Re: Is this the right thing to do?

Yes to all of the questions.. The small installment loan that I will be paying off is more monthly than the new loan (granted I will obviously be paying on it longer than the original loan. I plan on doing pfd with the collections and actually emailed 2 of them today and mailed a letter regarding the other two.

I was mainly worried about the DTI making my score drop a bit but I think getting the cards, collections, and small installment loan paid off is enough of a benefit to go for it
Moderator
Posts: 5,735
Registered: ‎08-12-2013
0

Re: Is this the right thing to do?


earlyKY wrote:
Today I was approved for a loan that will pay off a small existing installment loan, the remaining 4 collections that are my credit report, and pay off all 3 of my credit cards and fingerhut completely.

I should take the loan, right?

It would decrease your AAoA, but you'd definitely see improvement with UTIL.   If the loan has a better APR than the CCs and other TLs, it would probably make financial sense.

Start: 619 (Wally, 9/2013) | Current: 740 (Wally, 4/7/15)
AMEX BCE $13500 | Care Credit $10200 | JCP $8000 | Overstock $5200 | Citi DC WMC $5000 | Walmart Store $5000 | Amazon Store $5000 | Cap 1 QS $4750 | AMEX Costco TE $3500 | Macy's AMEX $3500 | Sony Card $3250 | Macy's Special Events $2900 | Macy's Revolving $2500 | CU Visa $2500 | Gold Violin $1750 | VS $1450 | Merrick $1200 | Target $1000 | ~~Gardening Since 3/17/15
Regular Contributor
Posts: 173
Registered: ‎09-10-2013
0

Re: Is this the right thing to do?

See the AAoA is something I still haven't figured out. My credit history is 12 years long, but I'm assuming AAoA only counts the items that are currently reporting. Does it count closed accounts? Charged off accounts? AAoA confuses me lol!
Valued Contributor
Posts: 1,632
Registered: ‎01-23-2013
0

Re: Is this the right thing to do?

With FICO, positive closed accounts count toward AAoA for up to 10 years, depending on whether the original creditor continues to report them that long. Negative closed accounts stay on a shorter time. One thing that makes it confusing is that some FAKO score sites, mainly Credit Karma, don't count closed accounts, but real scores do include them.

 

Epic Contributor
Posts: 22,406
Registered: ‎01-17-2008
0

Re: Is this the right thing to do?

[ Edited ]

Yes, all OC accounts, open, closed, good or bad are factored into your AAoA.

 

ETA:  For clarification, positive closed accounts stay up to 10 years from the date closed and will factor into AAoA.  Negatives, like a CO are reported until the CRTP is reached and will factor in until that time.  If the CO annotation is removed the account will become positve and stay for up to 10 years from the date closed.  Otherwise, it will be removed at the end of the CRTP.

 

It has to be on your CR to be counted for anything.

 

Regular Contributor
Posts: 173
Registered: ‎09-10-2013
0

Re: Is this the right thing to do?

So... I have a positive tradeline from an old installment account from 2004. I'm assuming it will fall off in 2014 thus dropping my AAoA?
Advertiser Disclosure: The listings that appear on myFICO are from companies from which myFICO receives compensation, which may impact how and where products appear on myFICO (including, for example, the order in which they appear). myFICO does not review or include all companies or all available products.

Copyright ©2001-2015 Fair Isaac Corporation. All rights reserved.   | Terms of Use | Privacy Policy | Sitemap

IMPORTANT INFORMATION: All FICO® Score products made available on myFICO.com include a FICO® Score 8, along with additional FICO® Score versions. Your lender or insurer may use a different FICO® Score than the versions you receive from myFICO, or another type of credit score altogether. Learn more

FICO, myFICO, Score Watch, The score lenders use, and The Score That Matters are trademarks or registered trademarks of Fair Isaac Corporation. Equifax Credit Report is a trademark of Equifax, Inc. and its affiliated companies. Many factors affect your FICO Score and the interest rates you may receive. Fair Isaac is not a credit repair organization as defined under federal or state law, including the Credit Repair Organizations Act. Fair Isaac does not provide "credit repair" services or advice or assistance regarding "rebuilding" or "improving" your credit record, credit history or credit rating. FTC's website on credit.