Re: FICO Score Breakdown (i.e., "Credit Mix")
12-12-2012 06:37 PM
Leaving aside the fako vs fico thing, there is one element missing from your mix: uncollateralized installment debt. Mortgages and auto loans are considered collateralized (or "secured", though that term freaks out people on this board) because if you default, there is a physical asset the lender can recover. Personal loans are considered uncollateralized or unsecured, because there is nothing to recover if you default. FICO does consider this a separate category. This past July, I took out a personal loan for some home renovation (not a home equity loan). Despite it being a new account, which would usually drop your score, my score went up by 15 points. Nothing else changed. I have no idea if the impact would be that big for someone already over 800, as I was in the 690s when I did it.
Seriously? This may answer my question for what to do with my unsecured personal loan when I'm looking to apply for an auto loan in the spring. I planned to pay it off with taxes, but maybe I'll pay off all but a portion and milk it for a bit longer. That's really interesting
Financed car @ 5.49% w/ DCU, Added DCU VIsa, Chase Freedom,
AMEX Gold and BCE, Lowe's