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Student loans considered as installment loans ?

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Super Contributor

Student loans considered as installment loans ?

For FICO scoring purposes is Student Loan considered as Installment loan or is it better to add a separate installment loan to the credit mix to boost the scores ?

Message 1 of 7
6 REPLIES 6
Contributor

Re: Student loans considered as installment loans ?

They are considered an installment loan

Starting score 6/19 TR 567 Ex 589 EQ 540
7/19 TR 620 EX 595 EQ 577
8/19 TR 643 EQ 614 EX 612
Goal: 680 by 12/19
Message 2 of 7
Established Contributor

Re: Student loans considered as installment loans ?

Yes, they are. You're good.
The best part is that if it's a federal student loan you'll likely end up with more than one before education is done. This usually helps build up good payment history and age on your file.
Additionally, any high utilization will not cost you that many points because they expect you to pay it off over time. Hope this helps.



Message 3 of 7
Valued Member

Re: Student loans considered as installment loans ?


@concorduser wrote:

For FICO scoring purposes is Student Loan considered as Installment loan or is it better to add a separate installment loan to the credit mix to boost the scores ?


My student loans provided a very good cushion for my recent app spree.

 

I applied for about 5 different cards in the last 2 months and neither my AAoA (dropped from ~5 years to ~4 years) nor my scores (dropped from the 760-800 range to to the 740-780  range) took nearly as much of a beating as I feared. In fact, my scores are already trending back upward.



As of 7/11/19




Message 4 of 7
Established Member

Re: Student loans considered as installment loans ?

Yes, it is considered installment. I paid off my student loan several years ago and it has fallen off my Vantage score. But for FICO, despite being closed, it added to my length of credit history several years past being paid.






Message 5 of 7
Established Contributor

Re: Student loans considered as installment loans ?

I believe it's 7 years for the lates and 10 years for the closed account. That and the low interest rate is why they caution those just entering repayment to pay your student loans off steadily, but don't rush to pay them off too quickly.



Message 6 of 7
Valued Contributor

Re: Student loans considered as installment loans ?


@Sabii wrote:
I believe it's 7 years for the lates and 10 years for the closed account. That and the low interest rate is why they caution those just entering repayment to pay your student loans off steadily, but don't rush to pay them off too quickly.

^ This is why people think I'm crazy for paying off my loan like it's on fire Smiley Wink  

(it is 0.4% higher than my auto loan, though Smiley Wink )




Garden goal: keep on keepin' on until 2020.
Message 7 of 7
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