Consumer Finance Accounts

[FlaDude]

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@SouthJamaica wrote:

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I've never heard of "Service Finance".

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They finance home repairs, in our case a new central AC. It's been paid off for over 5 years, but has another 5 before it drops off. 

[md_rebuild]

I was wondering the same thing.   I had 2 Best Egg finance loans (about $10K total - from 2 years ago) that I just decided to pay off.   They haven't reported to the bureaus yet, but I am curious about the impact on my score (since I paid them off) and also what the impact will be as they age.

[MissLiz]

@md_rebuild  If they haven't reported to the bureau's in the past two years, hopefully they won't report when you pay them off. Keep us posted!

[SouthJamaica]

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@FlaDude wrote:

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@SouthJamaica wrote:

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I've never heard of "Service Finance".

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They finance home repairs, in our case a new central AC. It's been paid off for over 5 years, but has another 5 before it drops off. 

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Well it certainly sounds like the type of account that would be classified as a CFA.

[md_rebuild]

@MissLiz  Sorry, just now realize that my 1st post wasn't clear.   They posted to the bureaus when I establshed them.  I am wondering what (if any) score change will occur with them being paid off (and my overall debt dropping by 1/3) and then what will happen when they age off completely (10 years!).

I've learned my lesson on CFAs.   As I previously mentioned on antoher thread I love going to baseball games, getting good seats, and then just paying them off over time.   I had no idea that every time I did that through StubHub, using Affirm, each one was going to show up as a CFA!

[MissLiz]

@md_rebuild  Oh, I see! At least you know that when they report paid off, the ten year clock starts until they're gone. The DP's are all over the place as to how damaging (or not) they may be. I *think* they count as an installment loan, so if you don't have any others, it may effect your credit mix score, and if you do, it may effect your overall utilization once closed. 

Again, I'm no expert, but it feels like paying off these loans would trigger a score increase. 

[AzCreditGuy]

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@MissLiz wrote:

@md_rebuild  Oh, I see! At least you know that when they report paid off, the ten year clock starts until they're gone. The DP's are all over the place as to how damaging (or not) they may be. I *think* they count as an installment loan, so if you don't have any others, it may effect your credit mix score, and if you do, it may effect your overall utilization once closed. 

Again, I'm no expert, but it feels like paying off these loans would trigger a score increase. 

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 No they dont as they are seen a negative, the funny thing is when you have the CFA loan its a postive in pts, and when I paid my off, my score went down

[MissLiz]

@AzCreditGuy  That's interesting! We will see if my score drops after Affirm posts the paid off account. It'll be a month or more before that happens as I've just paid it off, but I will come back and update. 

[TrapLine]

The mention of conflicting reports is scary.

In my travels at one time Citi One Main tossed a CFA and I had a Wells Fargo credit card (can't remember the details) years back issued outside the normal channels and it had a CFA. At the time I had no clue until reading on the MF Forum. Those cards are long gone now but once I better understood things, I stay away from anything but known main stream credit.

After the big meltdown long in the past I do not want lingering problems. Note, something else that bothers me is institutional memory. That is, just because our credit reports are clean does not mean the financials did not save the past. Example is Citi Bank who will not let go of the past and they were the first real bank credit card issued after the big BK (it took eight years  to get a main stream regular credit card after the big BK years back for me). Un real!

[AzCreditGuy]

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@MissLiz wrote:

@AzCreditGuy  That's interesting! We will see if my score drops after Affirm posts the paid off account. It'll be a month or more before that happens as I've just paid it off, but I will come back and update. 

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@MissLiz Well I can already tell you that your score will drop. You no longer have a loan, so you will penalized for that and than the CFA code will pop up as well, another ding. Diff lets us know how much for a drop