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Impact of adding auto loan to thin file

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SouthJamaica
Mega Contributor

Impact of adding auto loan to thin file

A profile I'm monitoring for someone else, a fairly thin, fairly young profile with 4 active revolving accounts, just added its first installment loan, an auto loan.

 

I found it very interesting that neither EX FICO 8 nor EX FICO 2 budged a single point.

 

EX FICO 8 Auto, however, went UP 24 points. I guess the Auto score likes to see an actual auto loan in the mix, even though it represents an increased debt burden, and not a nickel has been paid on it yet.


Total revolving limits 741200 (620700 reporting) FICO 8: EQ 701 TU 704 EX 685

15 REPLIES 15
JoeRockhead
Senior Contributor

Re: Impact of adding auto loan to thin file

That's interesting, I have a fairly thin file myself with Aaoa at 2 years. I co signed an auto loan (20k) with my DW back in July. Prior to signing that loan my scores were TU 791, EQ782, EX 775.  As soon as that loan hit my CR my scores took a major hit by over 20 points! They've been creeping back up since then but I was not happy about it at the time... Good for your friend though!

Message 2 of 16
pizzadude
Credit Mentor

Re: Impact of adding auto loan to thin file

Thanks for sharing these data points !  Interesting, for the FICO 2 / 8 scores I wonder if any points gained from improved credit mix were offset by reduced AAoA ?

March2010 FICO® ~ 695 TU, 653 EQ, 697 EX
Message 3 of 16
SouthJamaica
Mega Contributor

Re: Impact of adding auto loan to thin file

Yeah it's kind of puzzling. I would have expected all the scores to go down in view of adding a new account, with the new account being a 100% utilization loan. Maybe in a day or two the EX scores will shift.


Total revolving limits 741200 (620700 reporting) FICO 8: EQ 701 TU 704 EX 685

Message 4 of 16
SouthJamaica
Mega Contributor

Re: Impact of adding auto loan to thin file


@JoeRockhead wrote:

That's interesting, I have a fairly thin file myself with Aaoa at 2 years. I co signed an auto loan (20k) with my DW back in July. Prior to signing that loan my scores were TU 791, EQ782, EX 775.  As soon as that loan hit my CR my scores took a major hit by over 20 points! They've been creeping back up since then but I was not happy about it at the time... Good for your friend though!


That's what I was expecting to happen here.  Who knows, maybe EX just hasn't caught up to applying the FICO algorithms to the new data.


Total revolving limits 741200 (620700 reporting) FICO 8: EQ 701 TU 704 EX 685

Message 5 of 16
JoeRockhead
Senior Contributor

Re: Impact of adding auto loan to thin file


@SouthJamaica wrote:

@JoeRockhead wrote:

That's interesting, I have a fairly thin file myself with Aaoa at 2 years. I co signed an auto loan (20k) with my DW back in July. Prior to signing that loan my scores were TU 791, EQ782, EX 775.  As soon as that loan hit my CR my scores took a major hit by over 20 points! They've been creeping back up since then but I was not happy about it at the time... Good for your friend though!


That's what I was expecting to happen here.  Who knows, maybe EX just hasn't caught up to applying the FICO algorithms to the new data.


Would appreciate an update when/if anything changes, just to satisfy own curiosity is all... all my scores (FICO8) dropped across the board, 21, 21 and 23 points... it's almost as mysterious as Cap 1 CLI protocols, lol

Message 6 of 16
SouthJamaica
Mega Contributor

Re: Impact of adding auto loan to thin file


@JoeRockhead wrote:

@SouthJamaica wrote:

@JoeRockhead wrote:

That's interesting, I have a fairly thin file myself with Aaoa at 2 years. I co signed an auto loan (20k) with my DW back in July. Prior to signing that loan my scores were TU 791, EQ782, EX 775.  As soon as that loan hit my CR my scores took a major hit by over 20 points! They've been creeping back up since then but I was not happy about it at the time... Good for your friend though!


That's what I was expecting to happen here.  Who knows, maybe EX just hasn't caught up to applying the FICO algorithms to the new data.


Would appreciate an update when/if anything changes, just to satisfy own curiosity is all... all my scores (FICO8) dropped across the board, 21, 21 and 23 points... it's almost as mysterious as Cap 1 CLI protocols, lol


Sure thing.


Total revolving limits 741200 (620700 reporting) FICO 8: EQ 701 TU 704 EX 685

Message 7 of 16
mgood
Valued Contributor

Re: Impact of adding auto loan to thin file

I'm interested in following this too since I have no auto loans on my reports but I'm planning to add one in the next few months.



Starting Score: EQ8 680, TU8 713, EX8 701
Current Score: EQ8 771, TU8 766, EX8 775 as of March 28
Goal Score: EQ8 780, TU8 780, EX8 780

Take the myFICO Fitness Challenge
AZE5 - 2% Utl - New Accts: 2/6, 4/12, 6/24
Message 8 of 16
SouthJamaica
Mega Contributor

Re: Impact of adding auto loan to thin file


@mgood wrote:

I'm interested in following this too since I have no auto loans on my reports but I'm planning to add one in the next few months.


Most definitely will update.


Total revolving limits 741200 (620700 reporting) FICO 8: EQ 701 TU 704 EX 685

Message 9 of 16
MrFiah
New Contributor

Re: Impact of adding auto loan to thin file

I'll add my DP's.   I was able to get an auto loan right after I became FICO scoreable so I mean extremely young and thin ( 2 revolvers is all).  My score dropped 30 points on Experian 8.  It did take about 2-3 weeks to show up though.

Message 10 of 16
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