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Regular Contributor
Posts: 131
Registered: ‎05-06-2007
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Finance Loan Tradelines?

Looking for suggestions...I took out a $500 loan at a finance company on 6/17 this year. At the time I didn't qualify for a bank loan...since most of them use TU...which is my lowest--low 600. At the time...I only had a $300 total tradeline. Now I have 4k total tradeline. I went ahead and got a BT off one of my CC and thinking about paying this finance loan off due to 43% interest..that's a joke I know. I knew once I established my credit that I would pay if off before I paid all that int. I called to get a pay-off and it will only be a little over 10% if paid now. Then again... I thought about paying like all but $20 dollars and extend it for a yr to establish more positive credit. 43% interest on $20 not a whole lot. But...my question is if finance company loans not looking good for me like peoples are saying...then what would you all suggest? I need someone that have seen some scoring difference w/ this. My scores are EQ 640 EX 632 TU low 600
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Posts: 16,385
Registered: ‎03-12-2007
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Re: Finance Loan Tradelines?



SGT_F wrote:
Looking for suggestions...I took out a $500 loan at a finance company on 6/17 this year. At the time I didn't qualify for a bank loan...since most of them use TU...which is my lowest--low 600. At the time...I only had a $300 total tradeline. Now I have 4k total tradeline. I went ahead and got a BT off one of my CC and thinking about paying this finance loan off due to 43% interest..that's a joke I know. I knew once I established my credit that I would pay if off before I paid all that int. I called to get a pay-off and it will only be a little over 10% if paid now. Then again... I thought about paying like all but $20 dollars and extend it for a yr to establish more positive credit. 43% interest on $20 not a whole lot. But...my question is if finance company loans not looking good for me like peoples are saying...then what would you all suggest? I need someone that have seen some scoring difference w/ this. My scores are EQ 640 EX 632 TU low 600

Consumer finance loans and your situation are tricky. First, it's not clear in your post why you took out the loan? Did you really need the $500? Second, are you more interested in saving $$ or improving your FICO scores? In your situation you might be able to do both.
Credit Profile - FICO 08 Scores (03-26-2015): EQ 814, EX 817, TU 822
All three scores were 850. Lost points for not having an open installment TL. So, BE WARNED!!!!!
Credit History: 27 years ~ AAoA: 13 years ~ Util: 1% ~ Inqs: TU 1


Credit Cards: Amex BCP ~ Amex Clear ~ Amex Platinum ~ Barclay Ring World Mastercard ~ Chase Freedom Signature Visa ~ CITI Dividend World Mastercard ~ FIA Fidelity Investment Platinum Visa ~ First Hawaiian Bank Gold Visa
Regular Contributor
Posts: 131
Registered: ‎05-06-2007
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Re: Finance Loan Tradelines?

I took it out just for personal use
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Posts: 16,385
Registered: ‎03-12-2007
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Re: Finance Loan Tradelines?



SGT_F wrote:
I took it out just for personal use

Well alright. Consumer finance loans do not help your FICO scores like prime loans might. This is something that has irritated me for sometime. Why FICO scores consumer finance loans negatively when they don't with sub-prime CCs, especially when revolving debt and util carries considerably more weight than installment debt.
 
You took the loan out and it will report I'm sure. This is a small loan and you are being ratejacked. I never recommend paying an installment loan off early unless you really want to save money. In your case you will have to. You stand to gain a little bit more in FICO points if you pay over the full term of the loan. Your idea of paying most of it off is good, it saves you money. Making tiny payments thereafter is good. You will have a subprime reporting paid as agree, its better than nothing.
 
Even with prime loans I have never seen a big rise in my scores simply because I paid the loan off quickly or even if I paid for the full term. It may help with your credit mix but I'm not certain because it is a sub-prime loan.
Credit Profile - FICO 08 Scores (03-26-2015): EQ 814, EX 817, TU 822
All three scores were 850. Lost points for not having an open installment TL. So, BE WARNED!!!!!
Credit History: 27 years ~ AAoA: 13 years ~ Util: 1% ~ Inqs: TU 1


Credit Cards: Amex BCP ~ Amex Clear ~ Amex Platinum ~ Barclay Ring World Mastercard ~ Chase Freedom Signature Visa ~ CITI Dividend World Mastercard ~ FIA Fidelity Investment Platinum Visa ~ First Hawaiian Bank Gold Visa
Regular Contributor
Posts: 131
Registered: ‎05-06-2007
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Re: Finance Loan Tradelines?

[ Edited ]
They report only to EQ which is my highest score--640. My 2 options are: (1)Pay it off and ask them not to report it...a chance but maybe a long shot. (2)Pay all but maybe $20 and stretch it out for a yr. I belive this is my best option. I will still save over $150 if I done this.


Message Edited by SGT_F on 07-10-2007 05:42 AM
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Regular Contributor
Posts: 131
Registered: ‎05-06-2007
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Re: Finance Loan Tradelines?

[ Edited ]
Update: I called the finace company this morning and told him what I wanted to do. The manager told me that if I paid all but $20 it would still have me paying $160 in interest. Man they must think I am "Joe Willie Silly". I am going to pay them off today. 13% still beats over 43%.They won't ever have to worry about seeing me. All I 'm looking forward doing business w/ is credit unions and banks.


Message Edited by SGT_F on 07-10-2007 12:43 PM
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