cancel
Showing results for 
Search instead for 
Did you mean: 

Adding an installment loan -- the Share Secure technique

Community Leader
Senior Contributor

Re: Adding an installment loan -- the Share Secure technique

Hello Rookie.  The first post on this thread has enough information to answer the question about whether this would likely help you.

 

Do me a favor and read through it again and then tell us if you still don't understand it.

 

Best wishes...

Frequent Contributor

Re: Adding an installment loan -- the Share Secure technique

CGID, I did read the post and I saw that it may not help as a "quick fix" for when getting a mortgage, but I also have a thin credit file, so that's why I asked.
FICO8 Scores - 625TU / 640EQ / 649EX
On Mortgage Journey
Starting Mortgage Scores (Feb 17) 523EQ / 547TU / 564EX
Mortgage Scores Aug 17 624EQ / 649TU / 650 EX
Community Leader
Senior Contributor

Re: Adding an installment loan -- the Share Secure technique

It looks like you have four accounts on your credit report.  (Two of these may need another month to appear.)  Is that right?

    Capital One credit card (in your name)

    Capital One credit card (AU on husband's)

    NFCU credit card

    Westlake Financial - auto loan - paid and closed Dec 2016

 

Some mortgage lenders require at least three accounts, but you have four, so you should be set as far as the issue of "thickness" goes.

 

As far as the possibility that an SSL could improve your mortgage scores, here is what the guidance says in that first post:

 

I am preparing to buy a house soon,  Will this technique help my mortgage scores?

The technique is really intended to help a person with his FICO 8 scores, not his mortgage scores.  But... if you have no installment loans of any kind, including closed ones, then it's worth doing.  Also, if getting a 20 point boost to your EX mortgage score would change the value of your "middle" score, then again it is worth doing.  Otherwise it does not appear to help a person's EQ or TU mortgage scores.

 

Your mortgage scores are

 

541 EQ    555 EX    609 TU    

 

in the order of low, middle, high.  Suppose the SSL raises your EX score by 20 points.  Will that change the value of your middle score?

 

Final note:

Regarding your credit cards, you and your husband will benefit most from paying all cards to $0 and then each having exactly one card reporting a small positive balance, like $10.  For your husband's report, the card reporting $10 should be a card in his name; and for your report it should be a card in your name.  Also, you need to wait until all the credit cards you mentioned are appearing on the report -- at least two are not there yet.

Frequent Contributor

Re: Adding an installment loan -- the Share Secure technique

Ahh got it. Yes, I guess I do need to wait for everything to report on my credit.

I joined the MyFICO 8 subscription on March 13, and MyFICO 8 scores were 548EQ/558TU/568EX.
I got an alert this morning that the Comenity collection Settlement has posted and MyFICO 8 scores are now 575EQ/558TU/578EX.

On another note, my CapOne card should update on my credit by Tuesday, but the info for the new statement is updated in the app on my phone.
Last Statement Balance as of March 19: -$11.54
Available Balance $501
Min Payment Due Apr 2017: $0
FICO8 Scores - 625TU / 640EQ / 649EX
On Mortgage Journey
Starting Mortgage Scores (Feb 17) 523EQ / 547TU / 564EX
Mortgage Scores Aug 17 624EQ / 649TU / 650 EX
New Member

Re: Adding an installment loan -- the Share Secure technique

I'm really enjoying this thread and am excited about trying out the approach!  I've already signed up for the Alliant savings account and am getting ready to apply for the loan but wanted to mention something.  When I was signing up to join the credit union, instead of immediately donating the money to the charity, I took a look at the "qualifying organizations"... because who knows...and...actually, I am a member of one of them - the Freelancer's Union.  I've actually been a member for quite a long time and was pleased that it qualified me to join the credit union.  That being said, it's easy and free to join the Freelancer's Union and you don't have to actually be a freelancer, just someone supportive of the group - just go to their website and sign up - just pure number of membership helps them out, so there's not a fee or anything (and there are also some nice discounts for members).  Of course, it's also nice to donate to the charity but just wanted to offer up another route to qualifying for the credit union in case anyone wanted it. 

Contributor

Re: Adding an installment loan -- the Share Secure technique

I have to say CGID, this has to be hands down, the best post I've read on here. The step by step details are second to none. If only all instructions could be so clear. I was going to ask if this can be done via NFCU or PenFed, but after rereading it a few times, if I can get this done without having another hard pull, why would I bother? Has there been any data lately to support if a larger loan amount makes any difference? Like $3000 vs $500? Thanks again for posting this valuable gem!
Filed CH7 BK 7/15. discharged 10/15
Rebuild started 1/16 with scores of (EQ 517)(TU 547) (EXP 534)
Current scores (EQ 624) (TU 607) (EXP 774)
Overstock 500/700 I Open Sky 200/closed I Pay Pal MC 500 I Fingerhut 700/1400 I Primor 250/closed I One Nevada CU 500/closed I Target 500 I HC Credit 6000 I NFCU 1000 I Capital One Quicksilver 1000
Authorized User on I Cap One 700 I Barclay Visa 500 I Discover 17,200
Community Leader
Senior Contributor

Re: Adding an installment loan -- the Share Secure technique

Hey stakknchpz!  Thanks for that kind word.  Really made my day.

 

No data on what you describe, but that's because it would involve a lot of volunteers with detailed descriptions of their profiles, willing to be divided into groups of people who take out a $500 loan and those who take out a $3000 loan.  I am not holding my breath that all those people are going to raise their hands.  I am mildly skeptical that there is a scoring advantage, but some people like having a larger buffer after they pay the loan down to 8.99%.   With a $1000 loan you could pay it down to $89 and be fine.

 

I will tell you the three things I do very much want to see tested.

 

(1)  Does this technique benefit a person who (a) has open student loans and (b) all his open installment accounts are student loans and (c) all his student loans are in deferment

 

(2)  Same question as #1 but (c) at least one of his open student loans is NOT in deferement and is having payments made on it.

 

(3)  What kind of benefit does this technique give to a person's FICO 9 scores?

 

Questions #1 and #2 were raised by two different reports a year ago (not on this thread) that were challenging to explain except by the hypothesis that SLs were scored completely separately from auto and personal loans -- in which case a person with > 95% installment utilization on his SLs might still conceivably get a strong benefit from the SS loan technique.  The orthodox view is that there would be zero benefit (since his installment U would be virtually unchanged) but it would be good to know that this is mistaken (if true).

 

Question 3 I have been hoping to see people post about but thus far people almost exclusively report the bonus they get on their FICO 8.

Super Contributor

Re: Adding an installment loan -- the Share Secure technique


CreditGuyInDixie wrote:

Hey stakknchpz!  Thanks for that kind word.  Really made my day.

 

No data on what you describe, but that's because it would involve a lot of volunteers with detailed descriptions of their profiles, willing to be divided into groups of people who take out a $500 loan and those who take out a $3000 loan.  I am not holding my breath that all those people are going to raise their hands.  I am mildly skeptical that there is a scoring advantage, but some people like having a larger buffer after they pay the loan down to 8.99%.   With a $1000 loan you could pay it down to $89 and be fine.

 

I will tell you the three things I do very much want to see tested.

 

(1)  Does this technique benefit a person who (a) has open student loans and (b) all his open installment accounts are student loans and (c) all his student loans are in deferment

 

(2)  Same question as #1 but (c) at least one of his open student loans is NOT in deferement and is having payments made on it.

 

(3)  What kind of benefit does this technique give to a person's FICO 9 scores? <-Good Question!!

 

Questions #1 and #2 were raised by two different reports a year ago (not on this thread) that were challenging to explain except by the hypothesis that SLs were scored completely separately from auto and personal loans -- in which case a person with > 95% installment utilization on his SLs might still conceivably get a strong benefit from the SS loan technique.  The orthodox view is that there would be zero benefit (since his installment U would be virtually unchanged) but it would be good to know that this is mistaken (if true).

 

Question 3 I have been hoping to see people post about but thus far people almost exclusively report the bonus they get on their FICO 8.


This is a great question CGID that hopefully some new details might soon come to light for us.

 

I would assume the transition over to FICO 9 might finally begin to gain some real traction the deeper that we get into more quarters this year (or next?).

 

At least one of my card accounts are already FULLY measuring with FICO 9 and i also look forward to see how the SSL is directly affected or not.

Established Member

Re: Adding an installment loan -- the Share Secure technique

Just thought I'd add that as of today (and most likely for the forseeable future), Alliant does not do a hard credit pull for the shared secured loan. This was confirmed by 2 different representatives, who both checked with their supervisors and reported back that they don't even perform a credit check.

 

Hopefully this clears up anything in case someone is worried about a potential HP. 

Contributor

Re: Adding an installment loan -- the Share Secure technique

I have a question regarding the effect of this process. I currently have an open installment loan (car loan) with a small local credit union. I found out that they're only reporting to EX and TU, but not to EQ. I have closed installment loans on my EQ report, but nothing open. Will I see the typical 30ish+ point increase in my EQ score if I do this? Will the EX and TU scores be moderate to light increases?


Starting Scores: EQ [ 525 ] TU [ 567 ] EX [ 565 ] - 02/17
Current Scores: EQ [ 573 ] TU [ 581 ] EX [ 596 ] - 03/17