Co-signing a Loan

[TheRealT]

I co-signed a loan with my youngest son.  He is paying on time and has never been late.  I noticed the loan is on both my EQ and TU reports.  I see the payment history and balance information.

How is this affecting my score?  It shows up on Credit At A Glance, but when I run the FICO simulator, the account balance is not included.

Is it strictly a account balance/util% factor?

Thanks for the help!

[haulingthescoreup]

First of all, installment util is factored separately from your revolving util. Secondly, it's revolving util that is the FICO score driver. And thirdly, installment util is looked at, but it doesn't carry very much weight, unless you are pretty much perfect in every other regard.

If you have no other open installment accounts on your reports, this is helping. If you have other installment accounts, this is probably neutral. The only negative might be during the very first month, when it shows as 100%, plus of course, if there are any late payments, etc.

[smallfry]

Reduces AAofA.

[haulingthescoreup]

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smallfry wrote:
Reduces AAofA.

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Of course, duh me!

This might or might not change your scores, OP, depending on what your AAoA (average age of accounts) was before, the number of accounts on your reports, etc.

[TheRealT]

So I guess the loan affects my credit just as if I had took it out myself?  Correct?

Message Edited by TheRealT on 05-02-2009 09:58 AM

[haulingthescoreup]

Exactly. Since you co-signed, the loan is also yours.

If it's on your reports, it's going to be scored.