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Regular Contributor
hautemama
Posts: 104
Registered: ‎11-14-2007
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Another FICO question

Hi, I forgot to ask a question that I was curious about.. I recently totaled my car.. Which they are going to pay off ~11K.. After this is done, will it increase my credit score by much?? I am contemplating whether or not to get a new car loan and how much I should spend etc.. Please I value your input! Thanks so much.
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fused
Posts: 16,374
Registered: ‎03-12-2007
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Re: Another FICO question



hautemama wrote:
Hi, I forgot to ask a question that I was curious about.. I recently totaled my car.. Which they are going to pay off ~11K.. After this is done, will it increase my credit score by much?? I am contemplating whether or not to get a new car loan and how much I should spend etc.. Please I value your input! Thanks so much.



When paying off an installment loan, anything can happen. Some experience a small increase in scores, some virtually no change in scores (this is me) and others might see scores drop more than 15 points. There is really no way to know what will happen. FICO scoring places a great deal of emphasis on "recency" of both the good and bad stuff that is on your reports. So, recent installment activity will help scores while a lack of recent installment activity might hurt your scores some.
Credit Profile -
FICO 08 Scores (09-16-2014): EQ 824, EX 817, TU 822
All three scores were 850. Lost points for not having an open installment TL. So, BE WARNED!!!!!
Credit History: 26+ years ~ AAoA: 12 years ~ Util: 1% ~ Inqs: EX 1 (Amex 07-15-2014)


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