It will actually drop your score when you pay it off if it is a loan from a CU or bank. Open installment loans are beneficial to your credit score and there are people here that take them out just to give their score a boost.
I know, I know...If I have less debt my scores should go up? Wrong. It works that way with credit cards but not installment loans.
Thank you for your reply
So in other words pay off credit cards would be more beneficial to my score than to pay off loan?
Yes, you are correct. For optimal scoring you want 1 credit card to report less than 10% of its credit line and all your other cards to report $0. Your credit card utilization has a HUGE impact on your credit scores.
The balance on your installment loan doesn't really factor in your credit utilization for scoring purposes. Having an open installment loan will actually boost your scores at least 10 to 30 points.