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Was feeling great until recent score drop

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Was feeling great until recent score drop

So my FICO Score was steady and going up with my Experian at 608. I’m paying things and paid off a collection, got one removed ( could be a temp removal ) and hoping to have a goodwill work for another. I had a 6 month installment loan with Lendup and it finally showed as paid off and now my score dropped 13pts assuming due to lack of installment loan. Sheeeesh! Will this bounce back easily or will I need to always have an installment loan open to maximize my current low scores?

When I saw the 13pt drop my heart didn’t drop like it would have before that’s because I’ve learned a lot here and just yesterday learned about installment loan penalties.

 

edit: before I learned of how installments worked from myFico several days ago I was wondering when it will show as paid as I wanted it to look good. Well they showed me!

7 REPLIES 7
Senior Contributor

Re: Was feeling great until recent score drop

It may have dropped due to balance owed on the original amount. Once you pass certain % thresholds on the way to payoff. Score goes up. Once under 8.99% is the real boost. No worries it will goes up as you pay. Having the instllment as a credit mix factor does help. When I paid off my truck. Man 25-30 pts lost until I got in with Alliant just in time before they nerfed the SSL. Good Luck!





My posts are JMHO. I DO NOT claim to be a FICO expert. Just sharing my experiences from rebuild to recovery after BK DC. My siggy is not to brag at all. Just to show fellow members what can be accomplished when you do it right and play the FICO Credit Game.
Message 2 of 8
Moderator

Re: Was feeling great until recent score drop

When an installment loan closes (your last one) yes you can lose Fico 8 points, 13 is around the average number. Over time it wont matter or not if you have an open installment loan or not as Fico is geared more to revolving credit cards. I have the scores in my signature without an installment loan and it is one of the things that I get tagged for not having a perfect 850, I dont worry about it though over as 760+ gets you the best possible terms with most lenders. Just keep doing what you are doing and keep your revolving utilization low and over time your Fico will rise.

"If there's a lack of money in your life, understand that feeling worried, envious, jealous, disappointed, discouraged, doubtful or fearful about money can never bring more money to you, because those feelings come from a lack of gratitude for the money you have."

"Reactions are powerful creators because they contain every element needed to manifest—they're a combination of thought, belief, and feeling in action. Positive reactions create more positive things, and negative reactions create more negative things. If you can respond to negative situations calmly and lightly, instead of with emotional turbulence, what happens next in your life will be so much better."

- Rhonda Byrne

Message 3 of 8
Highlighted
Contributor

Re: Was feeling great until recent score drop


@gdale6 wrote:

When an installment loan closes (your last one) yes you can lose Fico 8 points, 13 is around the average number. Over time it wont matter or not if you have an open installment loan or not as Fico is geared more to revolving credit cards. I have the scores in my signature without an installment loan and it is one of the things that I get tagged for not having a perfect 850, I dont worry about it though over as 760+ gets you the best possible terms with most lenders. Just keep doing what you are doing and keep your revolving utilization low and over time your Fico will rise.


Thanks for the positive words. I’ll keep this in mind and work on other things. 

Message 4 of 8
Community Leader
Mega Contributor

Re: Was feeling great until recent score drop

I just wanted to add, while you do lose some points when loan is paid off, the presence of that TL still counts towards credit mix points (tho not as much). 

Your scores will recover in time.  I dont have an open loan, because I wont play scoring reindeer games, and mine are between 748 and 762.  

Work the derogs and you'll be fine. 

 

EX 759 EQ 774 TU 753


Message 5 of 8
New Contributor

Re: Was feeling great until recent score drop

pWhere you planning to add an SSL?  I would do that, with your score still in the high 500s to low 600s, you will benefit most from keeping an open installment loan on your reports. SSL is the way to keep this going the longest but you can use self lender or something similar for the score boost, just lasts a year at a time instead of several. 

Like everyone else said, you can have a great score without it, but I do think it will help you get your scores where you want them if you still have baddies hanging around. just my opinion though. good luck Smiley Happy


2/25/19 FICO 08 = EX-580, EQ-559, TR-610
Current FICO8 as of 5/21/19 = EX 621, EQ?, TR?
Exp mortgage score 607!
Message 6 of 8
Contributor

Re: Was feeling great until recent score drop


@MommaBear83 wrote:

Where you planning to add an SSL?  I would do that, with your score still in the high 500s to low 600s, you will benefit most from keeping an open installment loan on your reports. SSL is the way to keep this going the longest but you can use self lender or something similar for the score boost, just lasts a year at a time instead of several. 

Like everyone else said, you can have a great score without it, but I do think it will help you get your scores where you want them if you still have baddies hanging around. just my opinion though. good luck Smiley Happy


Yea that’s why I was thinking with my scores in high 5s and low 6s that can be a boost until I can stabilize without the installment loans. I don’t belong to any bank or credit union that dies SSLs. Self lender looks decent but I’ll hold of for a week to see if a credit union I’m going to join has SSL or credit builder accounts. Thanks for your input 

Message 7 of 8
New Contributor

Re: Was feeling great until recent score drop

absolutely! ..Good idea.  Smiley Happy

let us know how it goes.


2/25/19 FICO 08 = EX-580, EQ-559, TR-610
Current FICO8 as of 5/21/19 = EX 621, EQ?, TR?
Exp mortgage score 607!
Message 8 of 8
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