FICO's Drop After Car Loan Paid Off!

dragonfly66 · ‎11-07-2015

I fully expected there to be decrease of a few points, because I know how that kind of thing works, however, my decreases were rather large. I saw a drop of 14, 20 and 25 points on all 3 scores. That just seems a bit drastic if you ask me. The worst part is, I didn't just pay off my old car loan. I actually traded it in for a new car, so you would think that replacing one car loan with another would mitigate this kind of thing. Then, as if to add insult to injury, EQ knocked me down 3 more points for paying down the balance on my BrandsMart card by 20%. I have a feeling I may be getting "rebucketed", and my scores will probably be better off in the long run, but it hurts when that happens.

Current - FICO 3/2019: EX(753); EQ(763); TU(749)
Beginning - FICO 7/2014: EX(630); EQ(608); TU(581)
Credit: Wells Fargo Home Projects Charge Card ($7,800); Wells Fargo Home Rebate Visa ($4,000); Capital One Quicksilver ($10,000); Capital One Venture ($6,000); Discover it ($7,900); Macy's ($20,000); BrandsMart ($4,000); Banana Republic ($1,200); Lowes ($12,000); Amex Everyday ($30,000); Macy's Amex ($15,000); Amex Platinum (NPSL); Citi Diamond Preferred ($9,000); Chase Freedom ($9,000); Wells Fargo Outdoor Solutions ($10,000); SunTrust HELOC ($25,000)

Anonymous · ‎11-07-2015

A low balance installment loan was closed and large one was opened, FICO no likey. It will bounce back quickly though.

Congrats on on a new car!

dragonfly66 · ‎11-07-2015

@Anonymous wrote:
A low balance installment loan was closed and large one was opened, FICO no likey. It will bounce back quickly though.

Congrats on on a new car!

That rationale makes sense, but the FICO alert simply indicated that the score drops were a result of the old car loan being paid off. I guess the alerts aren't going to give you the full reason for why things are happening. Thanks for the insight.

Current - FICO 3/2019: EX(753); EQ(763); TU(749)
Beginning - FICO 7/2014: EX(630); EQ(608); TU(581)
Credit: Wells Fargo Home Projects Charge Card ($7,800); Wells Fargo Home Rebate Visa ($4,000); Capital One Quicksilver ($10,000); Capital One Venture ($6,000); Discover it ($7,900); Macy's ($20,000); BrandsMart ($4,000); Banana Republic ($1,200); Lowes ($12,000); Amex Everyday ($30,000); Macy's Amex ($15,000); Amex Platinum (NPSL); Citi Diamond Preferred ($9,000); Chase Freedom ($9,000); Wells Fargo Outdoor Solutions ($10,000); SunTrust HELOC ($25,000)

Anonymous · ‎11-07-2015

You are lucky...I lost 42 points (806 to 764) when my minivan came off the books.

It was like FICO wanted to remind (punish) me one last time about buying a minivan....

Anonymous · ‎11-07-2015

I fully believe the alerts make no sense at all. I subscribe to FICO, CCT and CK for that reason.

Yeah, that's my theory, is all.

@ mix Minivan...LOL...my DBF has one, and with every muster of manly pride must show every gadget and button in full prominade of how "awesome" it is. "LOOK AT THIS FEATURE. YOUR CAR CANT DO THAT." It's ok baby. More interesting is during his Guy's night out is having a crew of 40 something Dad's cruising in the minivan bc that's the most economical car for 5 grown men to cruise in.

girlinthecity · ‎11-08-2015

This thread is very helpful. I too am seeing a big drop as a result of paying off my 2011 car. I couldn't belive I was being dinged for paying off a loan but get a bump up for paying off a credit card. This is really unfair. A payoff is a payoff and should be rewarded. ; (

elim · ‎11-08-2015

ahhhh, The big Fair Isaac mystery.

I can't see you being a greater risk by lowering your DTI. I can only see you being ready to make a new auto purchase at a higher interest rate due to a score drop from paying off your loan.

Sounds fishy to me and always has.

Anonymous · ‎11-08-2015

Hey! I love my minivan! It's very utilitarian.

Anonymous · ‎11-08-2015

I lost 24 points for paying off my auto loan and then another 5 for a new purchase. I am not certain if the wisdom of the forum family or the bottle of wine eased my pain more - just know you are not alone... I wish I would have been trolling here long before that fiscal decision. TBH it was actually a wife decision - makes me feel better to think it was mine. Hope she doesnt make me get a mini van next. I will have to defend how cool it is!

Thomas_Thumb · ‎11-08-2015

@Anonymous wrote:
I lost 24 points for paying off my auto loan and then another 5 for a new purchase. I am not certain if the wisdom of the forum family or the bottle of wine eased my pain more - just know you are not alone... I wish I would have been trolling here long before that fiscal decision. TBH it was actually a wife decision - makes me feel better to think it was mine. Hope she doesnt make me get a mini van next. I will have to defend how cool it is!

No worries. Fico 8 appears to neeeed to see an open installment loan to be completely satisfied. You have made the model happy again ... and... now you also have a closed loan to boot. Look forward to increased score as you new loan ages and gets paid down.

Oh happy days are here again

P.S. You be the one with the collection and two open auto loans? Maybe not quite so happy.

Fico 9: .......EQ 850 TU 850 EX 850
Fico 8: .......EQ 850 TU 850 EX 850
Fico 4 .....:. EQ 809 TU 823 EX 830 EX Fico 98: 842
Fico 8 BC:. EQ 892 TU 900 EX 900
Fico 8 AU:. EQ 887 TU 897 EX 899
Fico 4 BC:. EQ 826 TU 858, EX Fico 98 BC: 870
Fico 4 AU:. EQ 831 TU 872, EX Fico 98 AU: 861
VS 3.0:...... EQ 835 TU 835 EX 835
CBIS: ........EQ LN Auto 940 EQ LN Home 870 TU Auto 902 TU Home 950