This is the only reason I'm still paying on my vehicle. I could have paid it off 2 years ago. Lol
Heh, at least you have options 
.
I was all nice and pretty with optimized installment utilization for FICO 8 / 98, and got my mortgage, and poof: no way to recover those lost points anytime soon short of coughing up ~200k (um... no) and would only be 6 or so points back if I get to the 80% line in another 2.5 years, but admittedly I'll absolutely be rebucketed by that point so maybe I'll get more back than that on my file.
@Anonymous wrote:Well, that's frustrating. I subrscribe to CreditCheckTotal through EX and check my report every day. Yesterday I was up to 752 after having been as low as 659 in August. I had only $116 remaining on my car loan from 2013 so I went ahead and paid of that last bit. My EX score instantly droped to 716, with one of the factors saying "No non-mortgage installment loan, you may not be able to manage a variety of credit accounts". **bleep**??? Not only was I able to manage that type of loan, I paid it off successfully with no lates!!
I guess my best option is to take out a small low-interest unsecured personal loan to 'show I can manage a variety of credit accounts'. I realize that's how FICO scoring works -- it just seems pretty stupid to me.
It's very stupid. When will they figure out that paying off a loan is a good thing?
It certainly can be frustrating. I'm trying to avoid this before this time next year. My auto, and random installment loans will be paid off. I know I'll be getting a new vehicle though, and I'm not sure if I need to get another small loan.
@Anonymous wrote:Well, that's frustrating. I subrscribe to CreditCheckTotal through EX and check my report every day. Yesterday I was up to 752 after having been as low as 659 in August. I had only $116 remaining on my car loan from 2013 so I went ahead and paid of that last bit. My EX score instantly droped to 716, with one of the factors saying "No non-mortgage installment loan, you may not be able to manage a variety of credit accounts". **bleep**??? Not only was I able to manage that type of loan, I paid it off successfully with no lates!!
I guess my best option is to take out a small low-interest unsecured personal loan to 'show I can manage a variety of credit accounts'. I realize that's how FICO scoring works -- it just seems pretty stupid to me.
It seems pretty stupid to me.
You're right about taking out a small low interest loan to get the points back, but don't do it as an unsecured loan and don't do it just anywhere, because you don't want an inquiry and you want to make it sure it reports right.
The tried and true method I'm aware of is to take out a $500+ savings account with Alliant Fedl Credit Union, take out a $500 share secured loan with 48 month or 50 month duration, either decline or remove autopay, after the loan reports, pay it down to $45 or so, pay around $1 a month for the duration of the loan.
@Anonymous wrote:OP, while I can certainly understand your frustration, FICO scoring needs to see a current installment loan to give you points for it. I've paid off 6 installment loans successfully with no lates and would still get the same point drop if I didn't have another current one. The rationale is that even though you've successfully paid off installment loans in the past, without having a current one there's no way to prove that you're able to do so today. FICO doesn't know if you've lost your income or something else dramatically changed in your life that would prevent you from being able to meet the terms of a new loan if you were to get one today. That's just how it works. Like others have mentioned above, the simple work around is to get another simple active installment loan going and you'll get those points right back once it reports.
It is rumored that FICO 9 is going to reduce the scoring distinction between open and closed installment loans; unfortunately no one actually uses FICO 9 yet, to the best of my knowledge.