@Anonymous wrote:I have 3 installment loans.
Auto- balance $18,500 from $22,000
Sofi- balance $17,000 from $25,800
DCU Personal Loan balance $9500 from $10,000
I am going to payoff the DCU loan right now in full.
Question is, will this have any positive score impact?
Unfortunately it won't have any seriously positive score impact in FICO 8. It would have more score impact to pay it down to $900, and use the other $900 towards the others.
But of course scores aren't everything.
@Anonymous wrote:
What?
Pay it down to $900 and use the other $900 towards the others?
I realize after doing research that there won't be any score increase.
It is indeed possible that going from 77.8% aggregate installment utilization to 61.4% won't provide a score increase, but it is more likely to produce a score increase than going from 77.8% to 74.3%.
@Anonymous wrote:
@Anonymous wrote:SouthJ is right. He's saying that there is a scoring factor called total or aggregate installment utilization.
That's where, for your open installment loans, you add up all the amount you currently owe on them. (Call that CURRENT.) Then you divide that by the amount that the open loans were originally for. (Call that ORIGINAL.) Then you divide CURRENT by ORIGINAL and get a percent.
Your total installment utilization (TIU) is about 77%. If you pay off the DCU personal loan, it will be 74%. But if you keep all three loans open and pay down the aggregate debt by 10k, it will be 61%.
From a pure scoring perspective, you will get the biggest bang for your buck by keeping all three loans open as long as you can while paying the total amount down. Even if you don't get an instant benefit by going from 77% to 61%, you will eventually cross some breakpoint where you will. Certainly you will get some substantial relief when your TIU gets to be under 9%.
And as SJ said, there's often other considerations than pure scoring ones.
Thank you very much for the detailed information. It helped me understand something I didn't know. Now I do.
That's why CGID is a "community leader". He's good at explaining stuff, and takes the time to do it 
@SouthJamaica wrote:
@Anonymous wrote:
@Anonymous wrote:SouthJ is right. He's saying that there is a scoring factor called total or aggregate installment utilization.
That's where, for your open installment loans, you add up all the amount you currently owe on them. (Call that CURRENT.) Then you divide that by the amount that the open loans were originally for. (Call that ORIGINAL.) Then you divide CURRENT by ORIGINAL and get a percent.
Your total installment utilization (TIU) is about 77%. If you pay off the DCU personal loan, it will be 74%. But if you keep all three loans open and pay down the aggregate debt by 10k, it will be 61%.
From a pure scoring perspective, you will get the biggest bang for your buck by keeping all three loans open as long as you can while paying the total amount down. Even if you don't get an instant benefit by going from 77% to 61%, you will eventually cross some breakpoint where you will. Certainly you will get some substantial relief when your TIU gets to be under 9%.
And as SJ said, there's often other considerations than pure scoring ones.
Thank you very much for the detailed information. It helped me understand something I didn't know. Now I do.
That's why CGID is a "community leader". He's good at explaining stuff, and takes the time to do it
You did well for me as well southy!
@Anonymous wrote:
@SouthJamaica wrote:
@Anonymous wrote:
@Anonymous wrote:SouthJ is right. He's saying that there is a scoring factor called total or aggregate installment utilization.
That's where, for your open installment loans, you add up all the amount you currently owe on them. (Call that CURRENT.) Then you divide that by the amount that the open loans were originally for. (Call that ORIGINAL.) Then you divide CURRENT by ORIGINAL and get a percent.
Your total installment utilization (TIU) is about 77%. If you pay off the DCU personal loan, it will be 74%. But if you keep all three loans open and pay down the aggregate debt by 10k, it will be 61%.
From a pure scoring perspective, you will get the biggest bang for your buck by keeping all three loans open as long as you can while paying the total amount down. Even if you don't get an instant benefit by going from 77% to 61%, you will eventually cross some breakpoint where you will. Certainly you will get some substantial relief when your TIU gets to be under 9%.
And as SJ said, there's often other considerations than pure scoring ones.
Thank you very much for the detailed information. It helped me understand something I didn't know. Now I do.
That's why CGID is a "community leader". He's good at explaining stuff, and takes the time to do it
You did well for me as well southy!
Aw thanks