To be explicit: the negative is not having sufficient open installment lines to satisfy the mix of credit function.
Paying off a loan early is not a negative, and often is a smart financial decision; however, dropping beneath the minimum number of installment loans (which appears to be ~2 for most people) is a small penalty, and closing your last open installment loan is a substantial one to the tune of 15-40 points from anecdotal reports depending on credit strata.
The cheap method for solving this is simply to take a small secured loan from any number of credit unions (Alliant, DCU, SDFCU, etc ad naseum) at a 1 or 2% interest spread and call it a day. Yuppie foodstamp interest charges when aggregated over the span of 4 years.
This is some vital info thanks for bringing it up. Unbeknowns to me now, i have for a few years been drawing down to the last few months left before payoff from a local bank unsecured loan and simply take out a new one which included paying off the old one. Now that FICO 8 is penalizing by a significant degree for paying off (that last lone installment) looks like will just stay with the way i been doing it all along.
Both interesting & disturbing FICO 8 now frowns on that type of responsibility 
@bobebob wrote:
@myjourney wrote:
@bobebob wrote:
@myjourney wrote:
@d-rolady wrote:I recently traded my car and the dealership paid off the balance, but the new car loan has yet to hit my credit. When the balance was paid off my credit score decreased by 23 pts. WHY?? Normally reducing debt increases the score, but this one decreased it. I have ample other debt on my credit, but I maintain a decent credit score. I don't understand what happened. EQ 734
Fico 08 strikes again
The new Fico 08 model seems to see a paid off installment as a negative some have gone as far as to get a small secured loan to offset this
Sorry you found out the hard way and in all reality the model should see this as a good thing ....Paying off debt
If the new FICO 08 model determines that you have paid off an installment early, then it would no longer just be looking at a snapshot of your finances. It would have to score based on past and present history.
We're told that it is still just a snapshot. So perhaps it is just dinging you for product mix (IE. no active installment loans).
If people are getting dinged for paying off debts early, then the score would not be measuring your likeiyhood of paying a debt back so much as a creditor's likelyhood of maintaining a steady income stream off of your interest payments. That would be at odds with the stated intent of the whole credit rating system.
Exactly this is whats Fico 08 is penalizing for no installments
Edit also to add 08 doesn't seem to differ as to if it was paid early or on time just the fact that the installment is now paid off
Which brings up another question:
If trade lines stay on your report for 10 years, why don't closed installment loans continue to count for that 10 years?
The marketing reason I read a while back stated that currently managing different types of open tradelines reduced the probability of default looking at the data.
Under FICO '04 it appeared that any installment history open or closed hit most of the mix of credit function: there were a few points here or there for not having open installment loans (was anecdotally determined to be 2 by a number of folks) but FICO 8 and presumably FICO 9 put a much higher weight on it.
These days I heartily recommend people have an open dipstick secured loan (or two) when we're talking FICO maximization if they don't have an open mortgage / student loans / auto loan / similar. The cost over 4 years is about the same as it would be to pull a single credit report and score from myFICO: if people are willing to instant in time spend $20 to check their FICO, I would suggest it's reasonable to spend that same $20 over 4 years (literally $20.68 total interest, $5 and change per year) to improve their score.
