Whenever I look on Experian/Myfico or if I'm denied for a credit limit increase, one of the reasons is "Proportion of loan balances to loan amounts is too high". So I fiddled around with score simulator, and it basically said that my scores would potentially increase 20+ points if I paid off my student loan. (I entered in the exact amount left on the loan, and it was the only number that increased my score). I know that the simulator isn't always accurate, but I only had 600 bucks left on the loan so I figured I should just get rid of it. So, I quickly paid off the loan in full, but now I'm worried that my EX scores will plummet. I have two student loans on Trans and EQ, so I'll still have one reporting on those reports. However, EX only reports the loan that has now been paid off. Did I just make a wrong move? I've been reading that paying off loans will hurt your score.
@ccb2115 wrote:
Whenever I look on Experian/Myfico or if I'm denied for a credit limit increase, one of the reasons is "Proportion of loan balances to loan amounts is too high". So I fiddled around with score simulator, and it basically said that my scores would potentially increase 20+ points if I paid off my student loan. (I entered in the exact amount left on the loan, and it was the only number that increased my score). I know that the simulator isn't always accurate, but I only had 600 bucks left on the loan so I figured I should just get rid of it. So, I quickly paid off the loan in full, but now I'm worried that my EX scores will plummet. I have two student loans on Trans and EQ, so I'll still have one reporting on those reports. However, EX only reports the loan that has now been paid off. Did I just make a wrong move? I've been reading that paying off loans will hurt your score.
Disregard all those comments IMO they are bogus, I got that message all the way down to 1 payment left out of the entire term and once it was PIF the message changed to no recent instalment loan experience. Instalment loans impact your overall Fico so little I would not even worry about it, you may lose a few points when your last one closes but they can be recovered as your revolving cards age, the only time an instalment loan really affects Fico is when you default on one. Most point loss I ever saw for last instalment closing was 10 point drop and I got them back within 2 months. Never keep an instalment loan just for Fico purposes nor get one for same.
@gdale6 wrote:
@ccb2115 wrote:
Whenever I look on Experian/Myfico or if I'm denied for a credit limit increase, one of the reasons is "Proportion of loan balances to loan amounts is too high". So I fiddled around with score simulator, and it basically said that my scores would potentially increase 20+ points if I paid off my student loan. (I entered in the exact amount left on the loan, and it was the only number that increased my score). I know that the simulator isn't always accurate, but I only had 600 bucks left on the loan so I figured I should just get rid of it. So, I quickly paid off the loan in full, but now I'm worried that my EX scores will plummet. I have two student loans on Trans and EQ, so I'll still have one reporting on those reports. However, EX only reports the loan that has now been paid off. Did I just make a wrong move? I've been reading that paying off loans will hurt your score.Disregard all those comments IMO they are bogus, I got that message all the way down to 1 payment left out of the entire term and once it was PIF the message changed to no recent instalment loan experience. Instalment loans impact your overall Fico so little I would not even worry about it, you may lose a few points when your last one closes but they can be recovered as your revolving cards age, the only time an instalment loan really affects Fico is when you default on one. Most point loss I ever saw for last instalment closing was 10 point drop and I got them back within 2 months. Never keep an instalment loan just for Fico purposes nor get one for same.
Thanks for the response! I feel a lot better now. I only have one installment loan reporting on EX so I thought my score would drop like 50 pts for paying it off.
I'm still a little nervous though. I've pretty much set up everythig perfectly to app for the CSP. However, now I am thinking I should app with my util at 14-18% instead of waiting for my last card to report as $0. If I wait, my util will dip below 10%.....but it's too close to the date the loan will post as paid in full/closed.
@ccb2115 wrote:
@gdale6 wrote:
@ccb2115 wrote:
Whenever I look on Experian/Myfico or if I'm denied for a credit limit increase, one of the reasons is "Proportion of loan balances to loan amounts is too high". So I fiddled around with score simulator, and it basically said that my scores would potentially increase 20+ points if I paid off my student loan. (I entered in the exact amount left on the loan, and it was the only number that increased my score). I know that the simulator isn't always accurate, but I only had 600 bucks left on the loan so I figured I should just get rid of it. So, I quickly paid off the loan in full, but now I'm worried that my EX scores will plummet. I have two student loans on Trans and EQ, so I'll still have one reporting on those reports. However, EX only reports the loan that has now been paid off. Did I just make a wrong move? I've been reading that paying off loans will hurt your score.Disregard all those comments IMO they are bogus, I got that message all the way down to 1 payment left out of the entire term and once it was PIF the message changed to no recent instalment loan experience. Instalment loans impact your overall Fico so little I would not even worry about it, you may lose a few points when your last one closes but they can be recovered as your revolving cards age, the only time an instalment loan really affects Fico is when you default on one. Most point loss I ever saw for last instalment closing was 10 point drop and I got them back within 2 months. Never keep an instalment loan just for Fico purposes nor get one for same.
Thanks for the response! I feel a lot better now. I only have one installment loan reporting on EX so I thought my score would drop like 50 pts for paying it off.
I'm still a little nervous though. I've pretty much set up everythig perfectly to app for the CSP. However, now I am thinking I should app with my util at 14-18% instead of waiting for my last card to report as $0. If I wait, my util will dip below 10%.....but it's too close to the date the loan will post as paid in full/closed.
Based on my experience where I dropped 18ish points on every FICO 8 score I have access to from what appears to have been paying off my auto loan, I'd consider apping before it personally. CSP isn't that difficult of a card to get underwritten, heck they even sent me a pre-approval of all things 
