Adding an installment loan -- the Share Secure technique

[Anonymous]

I have 13 payments left on my current auto so, so for now, it doesn't necessarily help me.  That said, when it's paid off, should I apply for another loan?  I've definitely thought of applying for a VA mortgage loan during that timeframe.  

[Anonymous]

Doing this with FICOs in the 780s is a waste of time. Frankly, it makes me sad when I see people wasting time on sites like this when their credit is in such great shape. Other than (sad) bragging rights, there's basically no additional advantage to having a FICO score over 740 or 750.

As for the person above with 13 months left on an installment loan, your FICO will drop as soon as that installment loan is paid off, so if you want to avoid that drop, open something like this loan before the other one is paid off.

[FiveOhFour]

High scores don't tell the whole story, I have about 3 years of credit history, 2 secured cards & a single proper quicksilver card. It shouldn't make you sad that I'm researching taking the steps neccesary to have a excellent and complete credit /report/. My score might be high but my credit diversity is poor and my number of accounts is poor and my available credit is mediocre at best

[FiveOhFour]

Not only that, but having a higher score does indeed do more than bragging rights. I'm disabled, so my income is limited, the higher my scores the less that minimal income hurts my ability to have decent lines of credit.

[Anonymous]

Agreed, that is my thinking. 

[Anonymous]

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@Anonymous wrote:

I have 13 payments left on my current auto so, so for now, it doesn't necessarily help me.  That said, when it's paid off, should I apply for another loan?  I've definitely thought of applying for a VA mortgage loan during that timeframe.  

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So, when the auto loan gets within a month or two of payoff, reassess and see whether you have no other installment loans.  Remember... the SSL technique helps you when you have no other open loans.  If you have a mortgage loan, then you will have an open loan.

[Anonymous]

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@FiveOhFour wrote:
High scores don't tell the whole story, I have about 3 years of credit history, 2 secured cards & a single proper quicksilver card. It shouldn't make you sad that I'm researching taking the steps neccesary to have a excellent and complete credit /report/. My score might be high but my credit diversity is poor and my number of accounts is poor and my available credit is mediocre at best

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Okay, that's a different story then. I would never guess that a person could have FICOs near 780 with such a short and thin credit profile.

Bottom line, though, as I said above, there's basically no difference between having a FICO of 740 and a FICO of 810 if the rest of one's application profile doesn't support an approval.

With such a thin profile, I'd probably try to get the secured cards unsecured and/or apply for another credit card or two before I opened this loan. Otherwise, your average age of accounts is going to take a hit without actually adding any new credit to your profile. (Are all of your cards 3 years old or is your oldest card 3 years old?)

[Anonymous]

No, when the car is paid off, I'll have no other open loans.  I take that back, I do have student loans, but they are deferred until 2021 and possibly further.  Does that count?

[Anonymous]

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@Anonymous wrote:

No, when the car is paid off, I'll have no other open loans.  I take that back, I do have student loans, but they are deferred until 2021 and possibly further.  Does that count?

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Yep, they count.

[Anonymous]

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@Anonymous wrote:

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Bottom line, though, as I said above, there's basically no difference between having a FICO of 740 and a FICO of 810 if the rest of one's application profile doesn't support an approval.

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Hi Joe.  There are products for which a higher FICO can help.  For example, if a person wants the best rates on PMI:

https://www.forbes.com/sites/trulia/2016/04/06/magic-number-the-ideal-credit-score-for-securing-a-mortgage/#76567f449731

There are reasons a person might want to go higher still, chiefly to create a buffer so that if they ever needed to increase utilization (etc.) they would still have a high score, even after the score hit.