Ok so here's where I'm at; I have a $2000 credit builder loan that I opened 2 months ago with my local credit union. $2000 for 24 months
What I would like to do is pay that off in full and then open a SSL with NFCU for $3100 for 60 months and immediately Pay it down to 8.9%
my initial though is I will recieve a net gain by having an installment loan open and near paid off (and one fully paid off)
Current standings
BK7 discharged in December 2019
3 credit cards AZEO
1 credit builder installment loan
fico 8's
EX 601
EQ 631
TU 584
Thoughts???
You may or may not have received a reduction in your AAoA Average Age of Account. If you open another account, it may lower it more if that is a concern.
If you aren't seeking additional credit in the foreseeable future, perhaps let the credit builder loan run it's course? Then apply for the Navy SSL when the time is right.
The counter argument would be paying off the credit builder loan and getting that $2,000 back. With the Navy SSL, you would get the majority of the funds back so it won't be tied up.
Does your local credit union allow prepayment that pushes out the due date like Navy?
If you do the Navy SSL, it will build your relationship with them. Perhaps, increasing your internal score and possibly opening the options for credit products in the future.
What would hurt or help more? The AAOA, the mostly paid off loan? I just feel like I'd rather have the account that I can keep for 5 years than the 2 year one. Maybe I'm not thinking this through properly. The only credit I plan on seeking is some better cards hopefully around the 1 year mark. Maybe Disco or an unsecured card from NFCU.
They do allow prepayment, and it does push the due date out, but they don't unsecure the funds until PIF.
@Bankrupt2019 wrote:Why would hurt or help more? The AAOA, the mostly paid off loan? I just feel like I'd rather have the account that I can keep for 5 years than the 2 year one. Maybe I'm not thinking this through properly. The only credit I plan on seeking is some better cards hopefully around the 1 year mark. Maybe Disco or an unsecured card from NFCU.
Having a higher AAoA helps, at least 2 years.
Having a mostly paid off loan helps.
@Bankrupt2019 wrote:They do allow prepayment, and it does push the due date out, but they don't unsecure the funds until PIF.
Can you share the name of this credit union?
CreditGuyInDixie was seeking an SSL alternative. The Quest for an SSL alternative to Alliant
Maybe your best course of action if you want to free up the funds and build your future is go for the Navy SSL?
Northeast Credit Union
@Bankrupt2019 wrote:Northeast Credit Union
Thank you! If you have time, please feel free to share your data points in the The Quest for an SSL alternative to Alliant thread.
@Bankrupt2019 wrote:They do allow prepayment, and it does push the due date out, but they don't unsecure the funds until PIF.
If you can pay the loan down with the funds, then just use this loan as your 'reindeer games' loan.
If not, then pay it off and go with the NFCU SSL plan.
I wouldn't close the account and open a new account just for the purpose of getting a longer 'reindeer games' loan. It's not worth the damage a new account does to your scores.
