Moderator Emeritus
Posts: 16,375
Registered: ‎03-12-2007
Re: Consumer Finance Companies

Tuscani wrote:

ilovepizza wrote:
Hmm. If paid and closed, it is good history, which raised your score. Removing it might lower your score and probably will. Personally I would never delete anything with good history. Anything with good history is better for your score. If you have a Consumer Finance Company high interest loan, PAY IT OFF, Close it! While it won't hurt your score, lenders will shy away from you until it is closed. After it is closed, it can only help your score.

It might be your auto loan too falling under finance company, ect installments. Open loans drop scores because they are debt. That simple. Pay it off and score will come up. I have never heard of any installment after being closed dropping a score if it was paid on time. Maybe if someone went to a debt consolidation place and set a fixed payment, but that would fall under something different than Consumer Finance. All closed installments raise scores not drop them regardless of title. If anyone has any documentation to show other wise please msg them to me or post them here.

Message Edited by ilovepizza on 05-18-2007 01:49 AM

I wouldn't agree that "All closed installments raise scores not drop them regardless of title".
Once it becomes a closed account instead of open you can take a score hit.
However, IMO paying off or down on installment loans has no effect on our FICOs. In fact, My brother paid off a car loan after having it for a year. He had $13,000 left on it. EX dropped 50 point... EQ dropped 30 points... and TU 20 points. Believe me FICO loves a good mixture of accounts. Luckily his scores rebounded a few months later so it was short lived!

Maybe you can give your insights on this Tuscani.  This raises a very interesting question!  If FICO scoring models/formulas can distinguish btw prime and subprime loans (i.e. consumer finance companies like say citifinancial), shouldn't they able to distinguish btw prime discover or amex cc's versus subprime cc's such as orchard bank or first primere when arriving at a score?  I have read on other threads FICO does not punish someone for having one, some or too many subprime cc's but they do for subprime loans.  Just food for thought
Credit Profile -
FICO 08 Scores (03-26-2015): EQ 814, EX 817, TU 822
All three scores were 850. Lost points for not having an open installment TL. So, BE WARNED!!!!!
Credit History: 26 years ~ AAoA: 13 years ~ Util: 1% ~ Inqs: EX 1, EQ 1

Credit Cards: Amex BCP ~ Amex Clear ~ Amex Platinum ~ Barclay Ring Mastercard ~ Chase Freedom Visa ~ CITI Dividend Platinum World Mastercard ~ FIA Fidelity Investment Platinum Visa ~ First Hawaiian Bank Gold Visa