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stopdrpnro
Posts: 28
Registered: ‎03-26-2012
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pay down installement loan for a quick boost?

[ Edited ]

Looking for a quick boost in my score. I'm at around a 620 trying get to 640 really fast to aquire a home loan. only have one credit  card and that's already paid down to 5%.  only other things on my credit are about 30k in student loans and  a 6k auto loan.  I have  about 1k i could  pay toward either of them  would I be better off keeping that $ or throwing it  at one of those loan amount.

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pizzadude
Posts: 9,220
Registered: ‎01-28-2010
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Re: pay down installement loan for a quick boost?


stopdrpnro wrote:

Looking for a quick boost in my score. I'm at around a 620 trying get to 640 really fast to aquire a home loan. only have one credit  card and that's already paid down to 5%.  only other things on my credit are about 30k in student loans and  a 6k auto loan.  I have  about 1k i could  pay toward either of them  would I be better off keeping that $ or throwing it  at one of those loan amount.


Installment utilization is a very minor component of FICO® scoring compared to revolving utilization so it is very unlikely that you would gain any points from paying down either installment balance. You *might* gain points from opening another CC ~ FICO® scoring usually likes to see more than one open revolving account.
March2010 FICO® ~ 695 TU, 653 EQ, 697 EX
Established Member
stopdrpnro
Posts: 28
Registered: ‎03-26-2012
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Re: pay down installement loan for a quick boost?

 wouldn't opening another credit card  this close to  applying for a  home loan  lower my score or at least make me look depserate?

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pizzadude
Posts: 9,220
Registered: ‎01-28-2010
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Re: pay down installement loan for a quick boost?


stopdrpnro wrote:

 wouldn't opening another credit card  this close to  applying for a  home loan  lower my score or at least make me look depserate?


How soon are you applying ? 6 months ? 1 month ? Your average age of accounts ( AAoA ) will be slightly reduced if you open another account. But it will improve your revolving utilization.
March2010 FICO® ~ 695 TU, 653 EQ, 697 EX
Established Member
stopdrpnro
Posts: 28
Registered: ‎03-26-2012
0

Re: pay down installement loan for a quick boost?

 i've already gotten a pre-approval but i'm attempting to secure a 203k loan which requires a little higher score.  The goal is to do something in the next  2 months.

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Revelate
Posts: 8,896
Registered: ‎12-30-2011
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Re: pay down installement loan for a quick boost?


pizzadude wrote:

stopdrpnro wrote:

 wouldn't opening another credit card  this close to  applying for a  home loan  lower my score or at least make me look depserate?


How soon are you applying ? 6 months ? 1 month ? Your average age of accounts ( AAoA ) will be slightly reduced if you open another account. But it will improve your revolving utilization.

Depends on AAoA, unless already over two years, or will tick over the two year mark pre-mortgage application, it makes no difference mathematically as it'll be counted as one year anyway.

 

Beyond that opening a new card while absolutely a good thing going forward, and if it doesn't adjust one's AAoA it'll likely be an immediate boost too (depends what else is in your credit file, if you have old closed cards, probably not), but if you're talking one month to a mortgage, you probably just need to wait it out for your score to recover naturally if you don't have a significant outstanding balance on your current CC.

Starting Score: EQ 561, TU 567, EX 599* (12/30/11, EX lender pull 12/29/11)
Current Score: EQ 04 679, EQ 8 708, TU 711, EX 702* (07/14/14, EX older)
Goal Score: 700 on EQ '04 (01/01/15)


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pizzadude
Posts: 9,220
Registered: ‎01-28-2010
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Re: pay down installement loan for a quick boost?


stopdrpnro wrote:

 i've already gotten a pre-approval but i'm attempting to secure a 203k loan which requires a little higher score.  The goal is to do something in the next  2 months.


What are the negative/derogatory items on your reports ? Can you try GW to clean them up if you haven't already ?
March2010 FICO® ~ 695 TU, 653 EQ, 697 EX
Established Member
stopdrpnro
Posts: 28
Registered: ‎03-26-2012
0

Re: pay down installement loan for a quick boost?

 i had 2 charge offs that were recently  remiedied  using gl letters the other negatives are all late payments on my student loans which are through  sallie mae, nc state, & college fondation.

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stopdrpnro
Posts: 28
Registered: ‎03-26-2012
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Re: pay down installement loan for a quick boost?

 i do have an orchard bank  credit card with a $400 limit .  would a request  for a cl increase be any different  from just getting another card? also  do secured cards show any differnatly than  non secured cards?

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pizzadude
Posts: 9,220
Registered: ‎01-28-2010
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Re: pay down installement loan for a quick boost?


stopdrpnro wrote:

 i do have an orchard bank  credit card with a $400 limit .  would a request  for a cl increase be any different  from just getting another card? also  do secured cards show any differnatly than  non secured cards?


Requesting a CLI will possibly cost you an hard inquiry, but that's it.    Do a search on Orchard to find out how they usually handle CLI requests.   Some cards report as secured in their name, but there's no difference in terms of how they are scored by FICO.

March2010 FICO® ~ 695 TU, 653 EQ, 697 EX

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