Credit Report Question

[ktm214]

I have 2 auto loans on my credit report, both less than a year old.  If I sell one of the vehicles and the account is closed, will my score tank?  Also, will it affect my AAOA since they were both opened in the same month?  Specifically my mortgage score.

[SouthJamaica]

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@ktm214 wrote:

I have 2 auto loans on my credit report, both less than a year old.  If I sell one of the vehicles and the account is closed, will my score tank?  Also, will it affect my AAOA since they were both opened in the same month?  Specifically my mortgage score.

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I would need to know what your original loan amounts and current balances are on both loans, and on any other open installment loans. There might or might not be much effect on your FICO 8 scores. Your mortgage scores are less likely to react.

It won't affect your AAoA, since closed accounts are counted the same as open accounts.

[ktm214]

Thank you for the reply.  The original balances were both $25,000.  The balance has not gone down much.  They are simple interest loans?  No other installment loans except a mortgage that was closed in 2015, and a few other auto loans now closed.  I do have some CC with only one reporting at at about 40% utilization.  

[Anonymous]

If both loans were around the same amount, opened at the same time and paid down similarly, closing one compared to having both open would probably result in very similar overall installment loan utilization.  That being said, I doubt you'd see any score change. 

If anything it would be a plus IMO, as you'd have 1 less account with a balance and from the DTI perspective of a mortgage it's a better "look" to have less debt.