Student loan utilization hurting score??

[Anonymous]

I am still in school so all my student loans are deferred. No payments have been made at all.  On freescore.com it says that my score is low because I have a high number of installment accounts (7 or more) open that are more than 95% utilized. But I keep reading post after post how student loans do not count towards utilization?? I have a car loan that I got in May that is only down $2000 with payments made. But I have several loans out that are still sitting at the original borrowed amounts. The only thing I can think of it that they're talking about the student loans. The other installment accounts I have are in good standing and are paid in full.

I do have several things in collections that I am waiting on PFD responses on but it clearly says "installment" accounts. Thoughts?? I was thinking of paying down a few of the small ones (I have a few that are $500 each) to under 30% utilization to see if that helps any.  If I started making monthly payments on the SL now even though they are not due now, will that help payment history? Could I get a boost that way??

[MarineVietVet]

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@Anonymous wrote:

I am still in school so all my student loans are deferred. No payments have been made at all.  On freescore.com it says that my score is low because I have a high number of installment accounts (7 or more) open that are more than 95% utilized. But I keep reading post after post how student loans do not count towards utilization?? I have a car loan that I got in May that is only down $2000 with payments made. But I have several loans out that are still sitting at the original borrowed amounts. The only thing I can think of it that they're talking about the student loans. The other installment accounts I have are in good standing and are paid in full.

I do have several things in collections that I am waiting on PFD responses on but it clearly says "installment" accounts. Thoughts?? I was thinking of paying down a few of the small ones (I have a few that are $500 each) to under 30% utilization to see if that helps any.  If I started making monthly payments on the SL now even though they are not due now, will that help payment history? Could I get a boost that way??

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Installment loan utilization is scored by FICO but's such a tiny part of that scoring as to be virtually meaningless. This is nothing to worry about.

This "advice" from freescore should be ignored as much as their worthless scores. This applies to all FAKO sites and the scores they sell and the advice they offer.

From a BK years ago to:
EX - 3/11 pulled by lender- 835, EQ - 2/11-816, TU - 2/11-782

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

[mazinaige]

I agree with MarineVietVet. I've financed a Ph.D. with GradPlus loans and have not yet began to make payments. The staggering balances are not hurting my FICO scores.  Don't waste your time with FAKO scores or advice. Direct your payments to an account that will actually help to increase your FICO score. 

[Anonymous]

Thanks for the info.

I guess I should try to bring down the balance on my car. I still owe $10k on a $12k loan. I've had it less than a year. I paid off my previous car about a year and a half early. Never late. But I didn't really want to do that on this car because I wanted to have the good payment history. Which do you think would benefit me better? Early pay off or four years of on time payments? thoughts?

[MarineVietVet]

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@Anonymous wrote:

Thanks for the info.

I guess I should try to bring down the balance on my car. I still owe $10k on a $12k loan. I've had it less than a year. I paid off my previous car about a year and a half early. Never late. But I didn't really want to do that on this car because I wanted to have the good payment history. Which do you think would benefit me better? Early pay off or four years of on time payments? thoughts?

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My advice is always the same. As long as you don't use up your savings pay off any debt as fast as possible with consideration of a score secondary.

Being debt free should always be #1 on your list of priorities.

This is just my personal opinion but that philosophy has served me well over the years.

From a BK years ago to:
EX - 3/11 pulled by lender- 835, EQ - 2/11-816, TU - 2/11-782

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

[mazinaige]

I think it's a personal choice. From a FICO perspective I think that four years of on-time payments would be more benificial to your score than paying the car off early. However, paying the debt off early saves you money on interest in the short term. There are so many variable to consider, like what other tradelines do you have and what are your financial goals? Are you trying to raise your score so that you can qualify for lower interest rates in the future? If not, pay off the car as fast as possible.