OP,
Out of curiousity, what are your current FICO scores?
@OmarR wrote:
@Citylights18 wrote:Getting back on topic if the plan is to be able to pay off the cards in 18 or 24 months you might be a lot smarter just going the BT credit card route which is going to be better than a 9.9% to a 29.9% personal loan. The numbers you find for personal loans on websites are not up to date with the latest lending rates.
OP has no credit card debt. He is doing it for the credit mix.
@Citylights18 wrote:If they shorten the life of the loan then you aren't paying as much interest on it. I'm not sure its a real strong argument against using a 24 month personal loan as you won't have it that long regardless and it will report once you close it for 10 years
I'll refer to the experts @Remedios @SouthJamaica , but does a CLOSED loan still satisfy the credix mix?
@Citylights18 wrote:Cash flow to me is important. Also I believe that being as tax advantaged as possible is more important. Home mortgage interest is tax deductable up to a purchase price of 750,000. I'm not a big fan of the 15 yr mortgage and shorter terms because while you are paying less interest the trade off is a higher payment and less cash flow. You don't get as large of a deduction and if price goes down you're overpaying for it. If you lose your job you will have less cost to cover in a 30 yr and you'll get more of your taxes back when you file.T credit card route which is going to be better than a 9.9% to a 29.9% personal loan. The numbers you find for personal loans on websites are not up to date with the latest lending rates.
Don't overthink a tax deduction as a primary factor/decision. You're paying your mortgage company, say, $10,000 in interest fees each year, only to get back $2,500. And that's assuming you are in an effective 25% bracket AND you don't use use the federal standard deduction. A lower bracket means even less money back.
I'm not an expert, but a closed loan which appears in your reports does satisfy the "credit mix" component.
@Citylights18 wrote:
@OmarR wrote:
@Citylights18 wrote:Getting back on topic if the plan is to be able to pay off the cards in 18 or 24 months you might be a lot smarter just going the BT credit card route which is going to be better than a 9.9% to a 29.9% personal loan. The numbers you find for personal loans on websites are not up to date with the latest lending rates.
OP has no credit card debt. He is doing it for the credit mix.
@Citylights18 wrote:If they shorten the life of the loan then you aren't paying as much interest on it. I'm not sure its a real strong argument against using a 24 month personal loan as you won't have it that long regardless and it will report once you close it for 10 years
I'll refer to the experts @Remedios @SouthJamaica , but does a CLOSED loan still satisfy the credix mix?
@Citylights18 wrote:Cash flow to me is important. Also I believe that being as tax advantaged as possible is more important. Home mortgage interest is tax deductable up to a purchase price of 750,000. I'm not a big fan of the 15 yr mortgage and shorter terms because while you are paying less interest the trade off is a higher payment and less cash flow. You don't get as large of a deduction and if price goes down you're overpaying for it. If you lose your job you will have less cost to cover in a 30 yr and you'll get more of your taxes back when you file.T credit card route which is going to be better than a 9.9% to a 29.9% personal loan. The numbers you find for personal loans on websites are not up to date with the latest lending rates.
Don't overthink a tax deduction as a primary factor/decision. You're paying your mortgage company, say, $10,000 in interest fees each year, only to get back $2,500. And that's assuming you are in an effective 25% bracket AND you don't use use the federal standard deduction. A lower bracket means even less money back.
I was on my soap box a bit there as I tacked on a couple of observations.
My philosophy is to be as tax advantaged as I can. 44% of my salary goes to taxes and that is with all the tax deductable contributions like 401k and HSA maxed out. That mortgage tax deduction for me is much more beneficial than it is for a 25% bracket person.
The credit mix they put everything in broad categories so the OP might be smarter taking out a new car loan if they have a lot of miles on their existing car and could benefit from trading up rather than just taking out 10,000 for no purpose.
Agreed, if the OP organically needs a vehicle or organically needs something else that would require an installment. But as others have said before, finances over fico.
Same goes for a mortgage. For every $1 spent, you do not get a $1 back, regardless of the bracket.
@Remedios wrote:Closed loan satisfies "credit mix" but there isn't much in terms of additional scoring points for closed loans.
Open loan under 9% can increase score by 25 points or more for a person with no open loans. Once loan is paid off, those points for getting it below 9% are gone, resulting in scoring "loss' (it really isn't, you only lose *award* for paying it below 9%, not for paying off loan - kinda counterintuitive, I'd love to see data that supports it).
That gain when loan is below 9% is the reason SSL work because you get to keep those points for years instead of few months.
Should a person get another loan, those points are gone, it only works with single open loan now 9%
I am intriqued with this statement "That gain when loan is below 9% is the reason SSL work because you get to keep those points for years instead of few months" --- how then to keep those points for years? So, pay the SSL up to 9% and not pay the principal anymore - just pay the interest?
If the goal is to improve your score, then add a 3rd credit card and show balance on one only! But pay in full for statement balance. In short months your score should be around 750+.
@OmarR wrote:
@Citylights18 wrote:
@OmarR wrote:
@Citylights18 wrote:Getting back on topic if the plan is to be able to pay off the cards in 18 or 24 months you might be a lot smarter just going the BT credit card route which is going to be better than a 9.9% to a 29.9% personal loan. The numbers you find for personal loans on websites are not up to date with the latest lending rates.
OP has no credit card debt. He is doing it for the credit mix.
@Citylights18 wrote:If they shorten the life of the loan then you aren't paying as much interest on it. I'm not sure its a real strong argument against using a 24 month personal loan as you won't have it that long regardless and it will report once you close it for 10 years
I'll refer to the experts @Remedios @SouthJamaica , but does a CLOSED loan still satisfy the credix mix?
@Citylights18 wrote:Cash flow to me is important. Also I believe that being as tax advantaged as possible is more important. Home mortgage interest is tax deductable up to a purchase price of 750,000. I'm not a big fan of the 15 yr mortgage and shorter terms because while you are paying less interest the trade off is a higher payment and less cash flow. You don't get as large of a deduction and if price goes down you're overpaying for it. If you lose your job you will have less cost to cover in a 30 yr and you'll get more of your taxes back when you file.T credit card route which is going to be better than a 9.9% to a 29.9% personal loan. The numbers you find for personal loans on websites are not up to date with the latest lending rates.
Don't overthink a tax deduction as a primary factor/decision. You're paying your mortgage company, say, $10,000 in interest fees each year, only to get back $2,500. And that's assuming you are in an effective 25% bracket AND you don't use use the federal standard deduction. A lower bracket means even less money back.
I was on my soap box a bit there as I tacked on a couple of observations.
My philosophy is to be as tax advantaged as I can. 44% of my salary goes to taxes and that is with all the tax deductable contributions like 401k and HSA maxed out. That mortgage tax deduction for me is much more beneficial than it is for a 25% bracket person.
The credit mix they put everything in broad categories so the OP might be smarter taking out a new car loan if they have a lot of miles on their existing car and could benefit from trading up rather than just taking out 10,000 for no purpose.
Agreed, if the OP organically needs a vehicle or organically needs something else that would require an installment. But as others have said before, finances over fico.
Same goes for a mortgage. For every $1 spent, you do not get a $1 back, regardless of the bracket.
For a mortgage 💸 its a win/win, you build an investment while having a place to live. My first home was a duplex in which I rented out the other side. Once you have a rental property you can easily reduce your effective tax rate and deduct things you would need anyway. That was true before they increased the standard deduction and I have been out of that game for a while now... but real estate has been really good for my overall net worth and I started investing in it 15 years ago.
here is an example of how I added 300k to my net worth in 5 years while in BK chp 13. I used a 401k loan of 50k to buy a crappy trailer on 4 acres with a water view of a reservoir. I lived in the crappy trailer for 3 years with no rent payment due. I sold the crappy trailer for 20k cash deal, and used the 20k to pay for items needed to build a single family home, septic, electric hookup, driveway for the delivery trucks and had some leftover to put the deposit down on the build. Builder financed the build with $1500 down and converted my loan to an FHA home which I qualified for while having only a secured card with a $350 limit as my only open tradeline and I got the trustee's approval for. Had the home built with no money down because my land had appreciated to more than double what I paid and there was no lien on it. I picked up a side hustle teaching college classes and got roommates to help with the mortgage while still in CHP 13, so I didn't have any reduction in my payment plan. Chapter 13 is over, I got rid of the roomates, and the home is now worth $650k on my 4 acres with a water view with a mortgage of 290k.... meanwhile my former primary residence which was exempt in BK has gained in value from 230k to 410k and my daughter is staying there while in college and she has roomates that help pay rent and she pays rent. So I built equity the whole time I was in BK. Real estate investments are gold if you get the right property, but you have to be very picky about what you get.
FICO 8: 
Goal: Gardening!
Goal: Gardening!