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Established Member
mloupagu
Posts: 18
Registered: ‎06-08-2007

revolving credit vs installment loan effect on FICO

[ Edited ]
I know that revolving credit debt (credit card) debt has a significant affect on your FICO score. Does installment loan debt (car loan) have as much as an affect?

Message Edited by mloupagu on 06-11-2007 08:11 AM
Moderator Emeritus
Tuscani
Posts: 6,182
Registered: ‎03-29-2007

Re: revolving credit vs installment loan effect on FICO

No.. Revolving is WAY more important.
Established Member
mloupagu
Posts: 18
Registered: ‎06-08-2007

Re: revolving credit vs installment loan effect on FICO

More important how? Bad or good? I just paid off most of my revolving credit (credit cards) and now only have a couple of loan payments (a car and a boat) plus a mortgage. I am thinking of trading in my car for a newer one which will increase the amount of the installment debt, will that lower my FICO significantly?
Moderator Emeritus
Tuscani
Posts: 6,182
Registered: ‎03-29-2007

Re: revolving credit vs installment loan effect on FICO



mloupagu wrote:
More important how? Bad or good? I just paid off most of my revolving credit (credit cards) and now only have a couple of loan payments (a car and a boat) plus a mortgage. I am thinking of trading in my car for a newer one which will increase the amount of the installment debt, will that lower my FICO significantly?


More important in the fact that balance owed on revolving accounts is more heavily weighted when determining a score. Trading in your car for a new one won't have much if an impact on your scores.. If anything, it will lower them in the short term as you are opening a new TL and closing another.

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