paying off my auto loan question

[bape7u]

Hi, I have an auto loan with the balance around 7k. it was a 20k 36 months loan. I am thinking about paying it off since I am looking to apply for a mortage. I believe the loan has 1 year left. since i don't want this loan included into my debt to income ratio. the question is...when i pay it off, will it reduce my average age of account? does it still count my loan as a 3 years loan or? i have a TU fico 740 with 1 yr 7 months average age of account. i really don't want to lower the average age of account

[MarineVietVet]

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@mutew8tch wrote:

Hi, I have an auto loan with the balance around 7k. it was a 20k 36 months loan. I am thinking about paying it off since I am looking to apply for a mortage. I believe the loan has 1 year left. since i don't want this loan included into my debt to income ratio. the question is...when i pay it off, will it reduce my average age of account? does it still count my loan as a 3 years loan or? i have a TU fico 740 with 1 yr 7 months average age of account. i really don't want to lower the average age of account

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Hello and welcome.

Your AAoA will not be impacted by this paid off, closed account. Your AAoA is the sum of the ages of every account (except CA collections and public records) on your report, whether open or closed. This is measured from the time each account was opened until present.

[mschang]

i read a few posts about people's scores decreasing after a CO fell off because their AAOA went down

[MarineVietVet]

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@mschang wrote:

i read a few posts about people's scores decreasing after a CO fell off because their AAOA went down

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Yes that can happen from time to time.