@SouthJamaica wrote:
@Anonymous wrote:
@Anonymous wrote:Quick note to Heaven and BBS....
Our OP may not understand that you are talking about what happens when the total amount of open debt is paid down, not just one specific loan (he mentions a car).
If the car is his only open installment account, then total open debt is in fact the same as the car loan. But if he has more than one loan (a car and a mortgage, say) then it won't be. And indeed (in that case) he could pay the whole car loan to under 9% and get no scoring benefit at all, since he'll only be making a tiny dent in the overall amount.
Yes CreditGuy this is my only loan open. My home is paid for and I am planning on building a home next year and just wanted to know if it would help. Thank you all for your assistance..
IMHO it helps many of your scores -- certainly your FICO 8 -- to have your overall installment loan utilization percentage at 9% or less (but more than zero).
It has mixed effects on your mortgage scores, but it couldn't hurt.
When it costs on the order of 27K to do so, yes, it does hurt one's chances at a mortgage. Mo cash, mo bettah.
Optimizing for getting a mortgage is more than just optimizing one's FICO score though I agree that's an important part... if the cash spent isn't meaningful then hey, but I suspect 27K is meaningful in this equation since IIRC the home purchase price was on the order of 600k. As ABCD points out it's sort of moot not knowing where the OP stands today on his mortgage scores anyway when we're talking FICO optmization too.
@Anonymous wrote:
@Revelate wrote:
@SouthJamaica wrote:
@Anonymous wrote:
@Anonymous wrote:Quick note to Heaven and BBS....
Our OP may not understand that you are talking about what happens when the total amount of open debt is paid down, not just one specific loan (he mentions a car).
If the car is his only open installment account, then total open debt is in fact the same as the car loan. But if he has more than one loan (a car and a mortgage, say) then it won't be. And indeed (in that case) he could pay the whole car loan to under 9% and get no scoring benefit at all, since he'll only be making a tiny dent in the overall amount.
Yes CreditGuy this is my only loan open. My home is paid for and I am planning on building a home next year and just wanted to know if it would help. Thank you all for your assistance..
IMHO it helps many of your scores -- certainly your FICO 8 -- to have your overall installment loan utilization percentage at 9% or less (but more than zero).
It has mixed effects on your mortgage scores, but it couldn't hurt.
When it costs on the order of 27K to do so, yes, it does hurt one's chances at a mortgage. Mo cash, mo bettah.
Optimizing for getting a mortgage is more than just optimizing one's FICO score though I agree that's an important part... if the cash spent isn't meaningful then hey, but I suspect 27K is meaningful in this equation since IIRC the home purchase price was on the order of 600k. As ABCD points out it's sort of moot not knowing where the OP stands today on his mortgage scores anyway when we're talking FICO optmization too.
If the mortgage scores are the ones on this board I am a
Experian 816
Transunion 773
Equifax 767
Apply with confidence, if DTI clears and if you have easily documentable income, it will be an easy underwrite. 740 is basically the top tier for mortgages, 760 is top tier for PMI rates if you need that, but shouldn't on most lender's jumbo products anyway.
@Anonymous wrote:
@Revelate wrote:
@SouthJamaica wrote:
@Anonymous wrote:
@Anonymous wrote:Quick note to Heaven and BBS....
Our OP may not understand that you are talking about what happens when the total amount of open debt is paid down, not just one specific loan (he mentions a car).
If the car is his only open installment account, then total open debt is in fact the same as the car loan. But if he has more than one loan (a car and a mortgage, say) then it won't be. And indeed (in that case) he could pay the whole car loan to under 9% and get no scoring benefit at all, since he'll only be making a tiny dent in the overall amount.
Yes CreditGuy this is my only loan open. My home is paid for and I am planning on building a home next year and just wanted to know if it would help. Thank you all for your assistance..
IMHO it helps many of your scores -- certainly your FICO 8 -- to have your overall installment loan utilization percentage at 9% or less (but more than zero).
It has mixed effects on your mortgage scores, but it couldn't hurt.
When it costs on the order of 27K to do so, yes, it does hurt one's chances at a mortgage. Mo cash, mo bettah.
Optimizing for getting a mortgage is more than just optimizing one's FICO score though I agree that's an important part... if the cash spent isn't meaningful then hey, but I suspect 27K is meaningful in this equation since IIRC the home purchase price was on the order of 600k. As ABCD points out it's sort of moot not knowing where the OP stands today on his mortgage scores anyway when we're talking FICO optmization too.
If the mortgage scores are the ones on this board I am a
Experian 816
Transunion 773
Equifax 767
If you're referring to your FICO 8 scores, no those aren't the mortgage scores.
If you pull your 3B report, the mortgage scores are the EQ FICO 5, TU FICO 4, and EX FICO 2.
