Score drop w loan payoff

[JustKeepSwmng]

Today my FICO score dropped a whopping 34 points after my auto loan updated as paid off. 

Original loan was ~60k, got totaled and paid off at $19k left.

I have open student loans and open personal loans. I thought this penalty only happened with no open installment loans? 

This is upsetting, I need a new car and I am car shopping right now. 

[JustKeepSwmng]

So have gone through many many threads. Still can't find a reason for this. I had been monitoring scores daily because am actively paying down utilization.

- One thought is my student loans are consolidated and deferred. Maybe they stop counting??

- That doesn't explain thoguht the $25k personal loan that is open and reporting 

No negatives/baddies on any of my bureaus and they all took a 33-37 point hit on FICO 8

[Patient957]

Hmm.  Looks like you got the full penalty too.

What are the original loan amount and current balance on the $25K personal loan?  Which FI is the loan from?

Also are you a member of Navy FCU or Penfed?

[JustKeepSwmng]

Right seems like full penalty. 

auto loan that was paid off is BOA

personal loan is a credit union, it's newer- 3 months reporting going on 4th. At about 90%

I just became a NFCU member last week but have no products yet.

[Patient957]

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@JustKeepSwmng wrote:

Right seems like full penalty. 

auto loan that was paid off is BOA

personal loan is a credit union, it's newer- 3 months reporting going on 4th. At about 90%

I just became a NFCU member last week but have no products yet.

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A personal loan from a credit union should count as an open installment loan.

When I paid off my last open installment loan in 2023, I got the penalty, -32 points.  I got this reason code from MyFico:

You can take a look at your MF account and see if you got this reason code, or any new reason codes.  That would give a clue about what's going on.  Did you get any new reason codes on MF?

Maybe this is because your B/L ratio increased when your nearly paid off auto loan got paid off.

[JustKeepSwmng]

Yes I think it's the B/L change. Because the new loan is at high % and the one that was 30% got paid off instantly. 

The MF has a reason code of high loan balances. 

Had no idea that was a 30+ point risk. Now I see why some people take a larger loan to pay a portion immediately. 

[Patient957]

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@JustKeepSwmng wrote:

Had no idea that was a 30+ point risk.  

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I didn't either.  Looks like a high B/L is just as bad as no installment loan at all.

[TrapLine]

Welcome to the real world of credit. There are many of us that have experienced similar credit point reductions when a mortgage or installment loan is paid off.

In my case it was 22 point reduction on an installment loan. When I paid off the mortgage it was a much larger amount (can not remember how much). 

The whole world of credit reminds me of a pinball game!