How does paying off loans affect mortgage scores?

[Anonymous]

So, we're in the mortgage process right now (due to close 12/18). An installment loan I had paid off when I sold my house last month just updated and dropped my regular FICO transunion 25 points. I immediately ordered a report to see what it did to my mortgage score and it's unchanged, thankfully. So, now I'm concerned about the other 2 bureaus updating and what will happen there. Obviously, we don't want anything changing at this time.

So, do loans being paid not normally affect the mortgage score?

[chiefone4u]

I think paid loans only have an effect if it is your last remaining loan, or if it changes the aggregate percentage of remaining balance. 

If you paid off all installment loans and they haven't finished updating, you could see a change in scores.

While technically every bank is different, if you've already locked in your rate you should be ok with score changes as long as they aren't because of new debt (buying a car, opening a credit card or maxing existing cards).