Do you think my score will drop ?

[Andy77]

So I am paying off an auto loan with Penfed for 14600.00 in full and adding a BMW lease for 47500.00

Since the dollar amount is higher, do you think my score will drop ?

[Thomas_Thumb]

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@Andy77 wrote:

So I am paying off an auto loan with Penfed for 14600.00 in full and adding a BMW lease for 47500.00

Since the dollar amount is higher, do you think my score will drop ?

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For installment loans the Fico 08 scoring factor is having at least one open loan and the overall aggregate balance to loan ratio. The absolute dollar value of the loan(s) is not a scoring factor. I am not sure that a lease is considered an installment loan. If not, your score may suffer due to no open installment loan on file.

Someone else on the forum can better clarify how leases are classified in Fico World.

[Aahz]

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@Andy77 wrote:

So I am paying off an auto loan with Penfed for 14600.00 in full and adding a BMW lease for 47500.00

Since the dollar amount is higher, do you think my score will drop ?

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Your score will likely drop, but not because of the dollar amount (as TT posted above), but rather because you'll go from having a mostly paid down installment loan to a 100% owed installment loan.

[SouthJamaica]

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@Andy77 wrote:

So I am paying off an auto loan with Penfed for 14600.00 in full and adding a BMW lease for 47500.00

Since the dollar amount is higher, do you think my score will drop ?

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According to this article a car lease is treated the same as a car loan.

If that's the case, your score will get slammed, and will only recover after the lease is partly paid down.

Not because of the dollar amount, but because of the percentage utilization.

[Anonymous]

I can also confirm that a lease is treated the same as an auto loan as I have one of each currently and both are installment loans on my reports.

Scores will definitely take a hit here, how much I'm sure others can chime in on.

Could the OP benefit from the share secure loan technique in this situation?  Would having a second installment loan that's significantly paid off ease the sting of his new one that's at 100% of original balance, or do scoring models simply look at your installment loan that's in the worst standing at the time?

[RonM21]

I'm with the others. I'd think there may be a drop of some sort, but how much is hard to determine and more based on your overall profile.