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Impact of Auto loan payoff?

Frequent Contributor

Impact of Auto loan payoff?

Is there a positive score impact if i have an auto loan paid off?

 

I have two autos right now with roughly 13k on each...if i have one paid off, will i see a score bump?  Right now they're at about 75% of max balance.


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Valued Contributor

Re: Impact of Auto loan payoff?

I just paid mine off this month. I think a bump will occur because it will be an account reporting a 0 balance. From what I understand the more accounts reporting a 0 balance, the better.
FICO 08-EX: 746 TU: 752 EQ: 750 AAoA: 4yrs TLs: 40 Neg: 0

Credit Limits: $300,000+
Miles: 400,000+
MRPs: 200,000+
Cash Back: $2,000+
Message 2 of 3
New Member

Re: Impact of Auto loan payoff?

If you still have 1 auto loan open, then I'm gonna say your score will rise. You have to look at a balance of the types of accounts you have. Sometimes, a person with no mortgage account and pays off their auto loan early will see a decrease in their score, but where you still are keeping 1 of your auto loans open, this shouldn't be the case. If you just transfered the balance to another account, such as a credit card balance transfer, then you probably wont see a change. Unless, your balance transfer changes your credit card utilization ratio. Then, your score will probably drop if you don't have enough of a cushion between your credit card balance and your credit card limit.

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