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car payout

New Member

car payout

Im thinking about paying out my car earlier to free up money for a home. Will paying out early make my score better or worst?
3 REPLIES
Senior Contributor

Re: car payout

Neither.  Smiley Tongue

 

...on it's own.

 

Is it the only installment loan that you have?

 

Do you have two installment loans?  Three?

 

If it is your only installment loan, your score may drop a bit when it reports closed...nothing to worry about tho.

 

If you have three open installment loans, paying it off will boost your score, because you'll only have two open.

 

If you've got two installment loans and pay one off, it won't affect your score at all.

 

Good luck.  Smiley Happy

Zero percent financing is where the devil lives...

10/01/17 Fico8 scores: EX 660, EQ 647, TU 663
Valued Contributor

Re: car payout


a1-iam wrote:
Im thinking about paying out my car earlier to free up money for a home. Will paying out early make my score better or worst?
This may help with your UTIL, but generally isnt considered a way to increase scores. Depending on others things on your reports really depends on how will impact your scores if it impac
Good Luck
May all your dreams and wishes become a reality!
Epic Contributor

Re: car payout

There are two types of utilization used for FICO scoring.  Revolving and installment.  Installment utilization is such a small factor that paying it off or down will do next to nothing to improve your score.

 

If it is your only installment type account and it is closed you may take a ding for credit mix.