Debt to Income Ratios

[Anonymous]

I recently paid off a car (which is one of 2 auto loans on my report). I know when your car loan falls off your report, your score generally goes down a bit. But what happens when you have multiple auto loans and just one of them falls off? Shouldn't my score go up since I still have a good mixture of account types which would include an auto loan, while bringing by DTI down?

[Anonymous]

My credit report didn't update yet hence why I'm asking what generally happens in these situations. But I'll know soon enough regardless.

[ChemE_Bear]

Its unlikely that your score will go up because the auto loan was closed, because you're likely losing the bonus points you get having an installment loan at a very small % owed, unless your other auto loan is at very low utilization as well.

[ccquest]

Depends on what level each loan is at. From my understanding, there is a bonus for aggregate loan utilization being at certain levels. So if you had one at $1k/40k and the other at $39k/40k your total level would be 50%. Once you pay off the one, you're back to 97.5% which would drop points.

If they are both below 9%, you're golden and should only see points go up.

[Brian_Earl_Spilner]

DTI isn't used in scoring, only to see if you can afford credit you applied for.

[Anonymous]

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@Anonymous wrote:

I recently paid off a car (which is one of 2 auto loans on my report). I know when your car loan falls off your report, your score generally goes down a bit. But what happens when you have multiple auto loans and just one of them falls off? Shouldn't my score go up since I still have a good mixture of account types which would include an auto loan, while bringing by DTI down?

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Keep in mind that closing a loan doesn't cause it to fall off of your report.  Any closed account will typically remain present on your CR for ~10 years following closure.