topic Re: Installment Loan impact on score in General Credit Topics

Installment Loan impact on score

Junejer — Wed, 02 Jan 2008 02:37:28 GMT

I have a new installment loan (secured by my PIF vehicle). I have one month of reporting thus far and was planning on paying down about 20% of the outstanding balance ($4,940). Does anyone know what effect if any that will have on my credit scores? I tried to look for a way to simulate it on myFICO, to no avail. I tried to simulate an action on EX & TU, but it kept going to my EQ. I have little need to simulate my EQ at this point, at 742. I need help on the other ones. HELP please.

Re: Installment Loan impact on score

haulingthescoreup — Wed, 02 Jan 2008 03:43:30 GMT

Most people get very little score movement by fast pay-downs of installment loans. I paid one off, and I lost one point, big whoop. Now it might well be different with your scores up in the mid-700's.

Let us know what happens! We seem a bit short on examples of the effects of installment loans.

Re: Installment Loan impact on score

MidnightVoice — Wed, 02 Jan 2008 03:46:33 GMT

I don't think paying it down will help much, if at all

Re: Installment Loan impact on score

Junejer — Wed, 02 Jan 2008 03:55:45 GMT

Thanks. I am trying to move my middle score to the next tier in mortgage pricing. Need to get 700 from EX. Grasping at straws...have to stay away from the CCs until after closing, but need to raise score. Only debt currently is the loan. Any advice?

Re: Installment Loan impact on score

Anonymous — Wed, 02 Jan 2008 04:01:19 GMT

What negatives does myFico give you?

Many people (me included) get hit for having Zero CC balances.

One card with even $5 balance may help-

ByrdMan wrote:
Thanks. I am trying to move my middle score to the next tier in mortgage pricing. Need to get 700 from EX. Grasping at straws...have to stay away from the CCs until after closing, but need to raise score. Only debt currently is the loan. Any advice?

Re: Installment Loan impact on score

Junejer — Wed, 02 Jan 2008 04:28:38 GMT

MyFICO gives the following negatives: TU No revolving, Bad payment history (Utility Co). EX No revolving, short credit history. EQ No revolving, New Account. A few months ago, I applied for some business credit cards and they PG'd me, pulled TU & EX (None pulled EQ--that burns me). I would love to get a couple of personal cards (simulator says the score would increase 10-30 points). I don't want my mortgage lender to get antsy though, by seeing the INQs.

Also (BUMP) is it normal for myFICO to just allow simulation on EQ?

Just tried TU and simulation works. I guess EX doesn't add all the bells and whistles.

Thanks.

Message Edited by ByrdMan on 01-01-2008 08:28 PM

Re: Installment Loan impact on score

tbenz6876 — Wed, 02 Jan 2008 04:30:36 GMT

I was talking with a credit person and he stated that if takes 3 months of good payment history with an installment loan to get a score boast. He also told me that bank loans are the best because you can get up to 45 points.

I listened to what he told me and I was able to take my scores from the low 600 to around 690 on each. I am waiting to for all my CCC to report my paid off CC. I think I left a $10 balance on each for good measures.

Re: Installment Loan impact on score

Junejer — Wed, 02 Jan 2008 04:38:34 GMT

@Anonymous wrote:

What negatives does myFico give you?

Many people (me included) get hit for having Zero CC balances.

One card with even $5 balance may help-

@Junejer wrote:
Thanks. I am trying to move my middle score to the next tier in mortgage pricing. Need to get 700 from EX. Grasping at straws...have to stay away from the CCs until after closing, but need to raise score. Only debt currently is the loan. Any advice?

I live in TU land and most of the CCs pull EX & TU. With the exception of Cap1, who pull all three, I got just TU & EX pulls when searching for Biz Cred. The ex put us in ChexSystems hell, so I am going to have to pay off her balance before I can apply with the CUs that are suggested in the threads, I think (even though they favor EQ). With my INC and score from EQ, I could get a really nice CL from one of these. I am torn...not sure what to do.

Re: Installment Loan impact on score

Junejer — Wed, 02 Jan 2008 04:41:21 GMT

Bank loans as opposed to CU loans? I have my loan thru a CU. They pull from TU.

Re: Installment Loan impact on score

Anonymous — Wed, 02 Jan 2008 05:07:14 GMT

A new installment account is not going to help you (right now at least)

If wish you had a little more time- a CC is what you need.

The CCC's that I know will report quick all pull TU-

Re: Installment Loan impact on score

Anonymous — Wed, 02 Jan 2008 08:39:56 GMT

Couple years ago I had a car loan, that was supposed to be paid in 6o installment (5 years), I paid it off in about 18 installment and at about the halfway point began to notice an upward change in my Fico score, it wasn't big change but my TU went from 791 to 802, my EX went from 808 to 814 and my EQ went from 802 to 814. I am pretty sure that it was the reduction in the balance that caused these modest upward shifts( since everything else was the same)When I finished paying the loan their were no real changes in the scores. I must say I am a little surprised to how different are your scores between the 3 agencies, I mean 742 is a good score, 562 is not. How do you account for that?

Re: Installment Loan impact on score

Anonymous — Wed, 02 Jan 2008 08:40:27 GMT

Hooter's pulls TU and they were reporting before I got my credit card. Plus even being in the score range you have, will more than likely get approved without worrying about risking an unwanted INQ.

Re: Installment Loan impact on score

Junejer — Wed, 02 Jan 2008 08:49:00 GMT

@Anonymous wrote:
I must say I am a little surprised to how different are your scores between the 3 agencies, I mean 742 is a good score, 562 is not. How do you account for that?

mkatan:

My local utility company reports to TU and I recently went thru divorce, yada yada yada, I get some 90s reported to my CR. I also managed to get a PR removed from EQ, whereas it is still reporting to the other two. Last, and most importantly, TU hates me.

Re: Installment Loan impact on score

Junejer — Wed, 02 Jan 2008 08:54:24 GMT

@Anonymous wrote:
Hooter's pulls TU and they were reporting before I got my credit card. Plus even being in the score range you have, will more than likely get approved without worrying about risking an unwanted INQ.

Stef:

Might be worth a try, but I am due to close on a mortgage in the next couple of weeks and would hate to have an INQ, yet I really have to get my middle score up in the 700 range. This could happen with a couple of small cards reporting. Better talk with my Mortgage Broker first though.

What was your TU score when you got the Hooters card?

Message Edited by ByrdMan on 01-02-2008 12:54 AM

Re: Installment Loan impact on score

Anonymous — Wed, 02 Jan 2008 09:00:53 GMT

My score was ugly..umm, I mean 550. I don't think 2 weeks time will be enough for it to bring your scores up. I would definitely ask your broker what to do. I thought they used the middle of the 3 scores anyway?

Re: Installment Loan impact on score

Anonymous — Wed, 02 Jan 2008 09:04:15 GMT

OK, I can't see. Yes, you did say you had to pull up the middle score. Sorry about that. Late night... Good luck with everything.

Re: Installment Loan impact on score

Junejer — Wed, 02 Jan 2008 09:11:23 GMT

@Anonymous wrote:
My score was ugly..umm, I mean 550. I don't think 2 weeks time will be enough for it to bring your scores up. I would definitely ask your broker what to do. I thought they used the middle of the 3 scores anyway?

Simulator says that it should be worth 10-30 points, so conceivably two cards could mean 20-60 points with uti around 5-7% individually. If they can report the card right away, upon approval it would be possible to bring scores up. Just wish I knew 100% that someone would pull EQ though.

Re: Installment Loan impact on score

Anonymous — Wed, 02 Jan 2008 12:40:08 GMT

I bank with Chase and every 2 weeks I get those pre-selected visa offers. They pull EQ, but my history is too short to get the cc with thim. (average account is 4 months old) I live in Louisiana if that helps. Not sure if they are a EQ puller only, but maybe you could call to find out? It did take them about a month to start reporting a secured loan I got with them, so I could have a mix of credit, since I am trying to re-build.

Message Edited by stef37 on 01-02-2008 04:40 AM

Re: Installment Loan impact on score

Junejer — Wed, 02 Jan 2008 17:49:14 GMT

@Anonymous wrote:
I bank with Chase and every 2 weeks I get those pre-selected visa offers. They pull EQ, but my history is too short to get the cc with thim. (average account is 4 months old) I live in Louisiana if that helps. Not sure if they are a EQ puller only, but maybe you could call to find out? It did take them about a month to start reporting a secured loan I got with them, so I could have a mix of credit, since I am trying to re-build.

Message Edited by stef37 on 01-02-2008 04:40 AM

Stef, you live in EQ land. Chase pulls TU here for CCs. I can't stand that I am in TU's area.

Re: Installment Loan impact on score

Anonymous — Wed, 02 Jan 2008 23:10:30 GMT

Byrd, have you tried to do some kind of rapid rescoring? Maybe there is something your broker can help you with that can bring up that score, especially since you are on such short notice. I think there is like a 300 dollar fee, but, may be worth checking into.