10-23-2013 11:58 AM
I had 5 student loans, totalling about $15k. I was feeling zealous and when I had some extra cash, I paid off one completely (about $2k). My zeal has continued and I'm down to about $3k total for all my student loans now.
Now knowing what I know about FICO scoring, I've had the idea to really draw back on how much I'm paying these. If Age of Accounts, and having accounts in positive standing helps your score, my logic is to keep these loans around for as long as possible, paying as little as possible after I get them down to $1k or so (so the interest will be minimal). As opposed to paying them off quickly, this means 4 positive accounts will stay open, and therefore stay on my report longer. As I understand it, paid off loans tend to fall off after a max of 10 years - so paying them off now means they'll stay for a max of 10 years, whereas paying them off over the next 3 or 4 years means they'll stay for 13 or 14 years - not to mention having 3 or 4 more years of open status for accounts in good standing.
I'm relatively new to the credit game, though, and was hoping some more experienced folks would give me feedback. Is this is a bad idea? Or am I thinking logically?
10-23-2013 05:46 PM
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