@Anonymous wrote: The account once paid off was closed and new one was opened for $15k. So that closure is what dropped my score.
When you say "the account once paid off," what account are you talking about? The loan or your credit card? I'm not understanding if you're saying the loan being paid off lowers your score, or if you're saying once you paid off your credit card, you closed the card and that lowered your score.
@CreditInspired wrote: Hi OP With scores of mid 600s and 66% UT, I think it would be difficult to get a either a loan or CC limit of $25K unless you have a large income.
I do have a large income, and I will be applying for the loan through a credit union, that specifcally offers a loan fo this purpose.
Oh wow! I’m sorry I totally confused that didn’t I? I had an installment loan and when it was paid off early it closed the account. So that was why I dropped points on my score. But once the new installment hit my report it jumped my score again.
@Anonymous wrote: Oh wow! I’m sorry I totally confused that didn’t I? I had an installment loan and when it was paid off early it closed the account. So that was why I dropped points on my score. But once the new installment hit my report it jumped my score again.
Ok cool, thanks for clarifying!!! Would your score had not dropped if you let the loan run it's full term? I'm just curious how that works.
I think it would have because with installment accounts once they are paid in full they close. So it shows one less account and it has a negative effect. I have never had a loan run it’s course that loan I paid off early was my first. I wonder how that will change if I let it run it through the entire term.
10% of your fico comes from your credit mix, the ability the manage different types of credit. Credit cards are revolving credit while loans are installment credit. This is why the other person's score rose when the loan reported but fell once they paid it off.
