@Anonymous wrote:Your avg. length of credit history potenitally went down. if it was a 5-6 year loan you had 5-6 years history. if the majority of your LOC are less than that your avg. age went down and your score took a hit.
If you dont have many/any other installment loans (mortgage, student loans, etc) then your credit mix took a hit. as you have few/no installment loans and your score took a hit.
remember, these are computers doing the scoring. not humans. paying it off with no late payments doesnt matter to math problems.
when you pay something off, that line of credit closes. and you only get positive points for open lines of credit.
Actually there's no average length of open anything to our knowledge. Under FICO anyway, closed accounts count for those metrics.
In this case the installment utilization changed, as SJ said would really need the original loan balances for all loans, and then current Self Lender and prior auto loan (pre-payoff) and likely it was at something like 15% aggregate or whatever.
@niceassets wrote:It was the only open loan, had no late pays, and had a balance of about $1,400 prior to paying it in full. It now seems like I should have just kept the loan open and kept paying monthly. Live and learn.
I have a fairly thin file otherwise, with one card ($0 bal, low CL) and a SelfLender (Self) account, both with excellent payment history.
The only negatives are 2 old derogs,/collections... and I'm working on those PFD.
Isn't the "Self Lender" an installment loan?
Is it paid off?
Please explain what your "Self Lender" is and how it works/worked.
@niceassets wrote:First off, I appreciate your response and I'm not doubting you... just trying to better understand.
What you're saying is that because I have the Self Lender installment, I only lost 11pts with this PIF, but if it had been my only installment loan, I would have lost 20 pts when PIF???
Again, I'm not saying you're wrong at all, just amazed that paying off a loan in full with excellent history, drives your score down.
It's as if there's no point in getting installment loans, when they hurt your score more than they help... at least they did mine.
This was a few yrs ago. I paid off my truck. Had no loans. 32 pts loss. Then got a SSL loan. I think I had my 2 starter cards from Cap1 out of BK. And then approved for my first prime card from Cap1. That lowered it more.
Once it reported less than 8.9% it bounced right back up. It took 4 months to bounce back.
@niceassets wrote:Yes, Self is an installment loan technically, but it's somewhat unique in how it's designed to improve your credit score specifically.
Rather than explain it here, you can check it out if you're interested: self . inc
I'm aware of what Self Lender loans are.
I thought maybe yours was something different, since you said you had no other installment loans but then mentioned that you had a Self Lender loan.
In any event, you still haven't answered my questions, so never mind.
@niceassets wrote:You said, "please explain what your "Self Lender" is and how it works/worked", so I assumed you didn't know, my bad. I wasn't trying to seem demeaning in any way. Thanks for your continued assistance.
As for your other question, I apologize if I missed it. I was replying to a few other folks in the thread too.
I think you asked what the balance is/was on Self. So I just logged in now and this is what shows
EXPERIAN VANTAGE 30: 606
My Credit Builder Account
75% completeSavings progress $414.89Current card deposit $375.00Est. savings balance $39.89
Since your Credit Builder is scored as an installment loan, you don't need another installment loan to get a score boost in FICO 8. All you need to do is to get the Credit Builder down to 9% of the original amount.
@niceassets wrote:OK great, I'll continue to pay down the Self account, but it sounds like I want to make sure I do NOT have it PIF right?
If I do, then I'll lose the installment loan and my score will drop again. Same problem I started this thread about. lol
Yeah, the trick (not always necessary my FICO 8 scores when clean are higher than 800 anyway) is to get a loan paid down to some small fraction of it's original balance (<9%, $20 works fine) that allows you to pay ahead and moves the due date way out into the future.
That way you can leave a cheap loan on your credit report at a pretty installment utilization number for the FICO win for years.
Soon as you get a mortgage though those games come to an end unless you can play similar reindeer games with that and I know I can't.