Auto Loan; Payoff before new app?

[ForceMd]

Hello, I currently have a loan with NFCU that has a balance of $400 remaining. The loan is in good standing,and in fact when paid, will be finished 18 months early. I want to apply for a new auto loan, and sell my current car ( a 2008 Camery ). Basically, I was stiffed with this car when trying to do a favor for a friend. I financed the car with the understanding that she would make the payments, and when it was paid, I would " sell" it to her for $0. I did not want to consign, and I'm glad I didn't. Anyway, my question is, should I pay off the loan and wait until it shows paid on my CRs befor seeking a new loan, or will it be more beneficial for the loan to be active? Thanks (Edited for grammar correction IOS Autocorrect strikes again, also, FYI, the rich text editing does not cooperate with iPad, hence, the wall of text; Sorry ;( ).

[Creditaddict]

I don't think it's going to matter at all but you my as well pay if it's only $400, Lenders are still going to see the loan rather paid off or not and further more wouldn't you be going back to Navy for the new loan or are you looking at something brand new that has 0%?

[ForceMd]

Thanks for the reply Creditaddict. Yes, more than likely I will go through NFCU again. My plan is to get a check from Navy, then shop to see if i can get high tier 0% financing from a dealer. Paying the $400 is not an issue. I am basically holding the account until i gather more info. I didn't want to pay off the account only to find out that having a low balance report on the loan would be more favorable from a loan officer's perspective. I am just unsure if, generally speaking, having a current reporting auto loan is more or less favorable than having a complete (paid) loan report.

[pizzadude]

Your FICO score will likely not gain points as a result of paying it off, and since the loan balance is so small, I don't think that you really have anything to gain from paying it off early ~ unless it will save you some time/hassle when you are ready to negociate/purchase a new car.

[Revelate]

Take the extra month on the car loan to pay it off (or two months depending on your installment amount).

I think any difference from a lender perspective is going to be utterly trivial, but the two extra months on the loan may have a small but statistically meaningful benefit to your credit score longer term.

[ForceMd]

OK so the consensus seems to be that the $400 is small enough that it is inconsequential either way ( wether I pay it off immediately or not). Thanks for all of the replies.

[cdtotten]

It won't matter either way. It won't affect your AAoA, and you likely won't gain any points from paying it off (early doesn't matter at all). I'd pay it off just so you don't forget to, but it won't matter either way.