Re: How Will Paying Off CC vs. Installmen
t Loans Affect Score?
07-21-2007 07:07 PM
The installment loan doesn't disappear beacuse it's PIF. After it's PIF, usually this type of TL's status will change and become closed and age on your reports for up to 10 years. Best if there is nothing derogatory reporting on this type of TL such as lates. Again closed and open TLs are weighted and scored equaly, doesn't matter if they are revolving or installment. I have never heard of an installment loan PIF early hurting anyones FICO scores.
RobertEG wrote:Agreeing with all that has been said, I also offer the fact that paying off an installment loan takes it out of your "type credit" category. Could cost 10-20 pts. With installment loans gone, you will take a hit in the 85 pt credit mix category, which will be much greater than eliminating the loan. If FICO gain is your goal, keep it in the mix. Pay off revolving accounts, and take advantage of the history of payments on the ACTIVE installment loan.