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Co-Signed on a car

themrsmcgee
New Visitor

Co-Signed on a car

After the person refinances, will my score go up due to the loan being paid off?

Message 1 of 6
5 REPLIES 5
OmarGB9
Community Leader
Super Contributor

Re: Co-Signed on a car


@themrsmcgee wrote:

After the person refinances, will my score go up due to the loan being paid off?


Actually if you have no other open installment loans once the auto loan closes, unfortunately you'll end up losing points.


Last App: 04/05/2021
Penfed Signature Loan

Currently rebuilding as of 04/11/2019.

Starting FICO 8 Scores:




Current FICO 8 scores:


Message 2 of 6
themrsmcgee
New Visitor

Re: Co-Signed on a car

Thanks! I do have my own car loan, though. Just was wondering what would happen if I helped out a friend...

Message 3 of 6
Birdman7
Super Contributor

Re: Co-Signed on a car

It’s not that simple it depends on your aggregate loan utilization now, and then when he refinances. Also have average ages to consider.

It may not be a big deal if you already have a car loan. Again depends on where you’re at on yours.

-Scoring wisdom: General Scoring Primer, Payment History, Amount of Debt, Length of History/New Credit, Mix/Disputes/Freezes/Searches, Mortgage Scores/Negative Reason Codes/V.9, Helpful Links,
CassieCard’s Reason Statements Thread,
iv's friendly statement to reason statement concordance,

ccquest’s Workbook to calculate metrics.
Clean/Thick/Mature/No New Revolver - 8,9; Clean/Thick/Mature/No New Account - 5/4/2.
Correct Ag.Util. under 5% all times. (Oldest/avg varies. Estimates above.)
Real world mortgage maxes are: EQ5-818, TU4-839, EX2-844.




(Everything said is JMHO and is not endorsed by FICO or MF. I have no affiliation with either, just a grateful member.)
Message 4 of 6
OmarGB9
Community Leader
Super Contributor

Re: Co-Signed on a car

If you already have a loan and you cosign on another one, you'd take a score hit for the new account, as well as the drop in AAoA, and a hit for the fact that the new loan will be at full balance.


Last App: 04/05/2021
Penfed Signature Loan

Currently rebuilding as of 04/11/2019.

Starting FICO 8 Scores:




Current FICO 8 scores:


Message 5 of 6
Birdman7
Super Contributor

Re: Co-Signed on a car


@OmarGB9 wrote:

If you already have a loan and you cosign on another one, you'd take a score hit for the new account, as well as the drop in AAoA, and a hit for the fact that the new loan will be at full balance.


@OmarGB9 a loan does not reset the AOYRA Metric and does not cause Scorecard reassignment and the typical new account penalty. The only cost to him would be the change in average age if it were on a threshold and aggregate loan balance.

 

Assuming his own was already at 85% a refi for his buddy at 100% wouldn't make much of a difference. It all depends on the specifics. If that were his only loan aggregate would go from what 85% to 92.5%?

-Scoring wisdom: General Scoring Primer, Payment History, Amount of Debt, Length of History/New Credit, Mix/Disputes/Freezes/Searches, Mortgage Scores/Negative Reason Codes/V.9, Helpful Links,
CassieCard’s Reason Statements Thread,
iv's friendly statement to reason statement concordance,

ccquest’s Workbook to calculate metrics.
Clean/Thick/Mature/No New Revolver - 8,9; Clean/Thick/Mature/No New Account - 5/4/2.
Correct Ag.Util. under 5% all times. (Oldest/avg varies. Estimates above.)
Real world mortgage maxes are: EQ5-818, TU4-839, EX2-844.




(Everything said is JMHO and is not endorsed by FICO or MF. I have no affiliation with either, just a grateful member.)
Message 6 of 6
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