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After several years, I finally paid off my auto & student loans! It did impact my FICO score negatively, about 20 points decrease. I understand that having a mix of loan and credit is a good thing. Since the auto and students loans are no longer active and closed, should I get a Self loan so I have an active loan on my credit report?
@HappyGoLucky4U wrote:After several years, I finally paid off my auto & student loans! It did impact my FICO score negatively, about 20 points decrease. I understand that having a mix of loan and credit is a good thing. Since the auto and students loans are no longer active and closed, should I get a Self loan so I have an active loan on my credit report?
It's not necessary.
But if you want to pick up some easy points you could get an SSL from a lender like NFCU and immediately pay it down to 9%.
If you do nothing your scores will pick up anyway over time.
It's not "a good thing" to have loans; it's just a way to appease an anomaly in the FICO 8 and 9 algorithms.
I'd rather save lowering my AAoA for something I'll actually use.
@HappyGoLucky4U wrote:After several years, I finally paid off my auto & student loans! It did impact my FICO score negatively, about 20 points decrease. I understand that having a mix of loan and credit is a good thing. Since the auto and students loans are no longer active and closed, should I get a Self loan so I have an active loan on my credit report?
You might post your AAoA, So we could get an idea if it would be worth it?
My current AAoA is 3 years and 3 months
@M_Smart007 wrote:
@HappyGoLucky4U wrote:After several years, I finally paid off my auto & student loans! It did impact my FICO score negatively, about 20 points decrease. I understand that having a mix of loan and credit is a good thing. Since the auto and students loans are no longer active and closed, should I get a Self loan so I have an active loan on my credit report?
You might post your AAoA, So we could get an idea if it would be worth it?