I have student loans that will stack up, all being reported as different accounts due to disbursement dates. My question is, if I am to pay each one down to under 8.9%, will each one give me a boost to my scores as they each report under that certain percentage? Or if just having one installment loan reporting under that percentage is the only boost you get?
@MissLiz
I'm sure that's possible, no clue. Would love to learn though so I can know how to plan out my method of attack on a new loan every 2.5 months lol.
@Thomas_Thumb Gotcha. So, in theory, I can pay down each one as they come (every 2-3 months), and get it below the 9% or so, but once the next one hits it will be another to pay back down on the aggregate in order to see the boost?
Another question I had was is each one of these loans when they disperse and are added to my report going to hit me with a "new account ding" each time? I've read that the AAoA will definitely be beaten down with these, but in the long run they'll help the AAoA once they start to age themselves, being that there will be so many of them.
@GreyvyTrain wrote:I have student loans that will stack up, all being reported as different accounts due to disbursement dates. My question is, if I am to pay each one down to under 8.9%, will each one give me a boost to my scores as they each report under that certain percentage? Or if just having one installment loan reporting under that percentage is the only boost you get?
It's only the aggregate that is scored.
I myself have been wondering if a new installment loan resets the "Age of Youngest Account" metric.
@Thomas_Thumb wrote:
@GreyvyTrain wrote:I have student loans that will stack up, all being reported as different accounts due to disbursement dates. My question is, if I am to pay each one down to under 8.9%, will each one give me a boost to my scores as they each report under that certain percentage? Or if just having one installment loan reporting under that percentage is the only boost you get?
It's all about aggregate installment balance to loan ratio (utilization). That is the metric Fico scores. No you won't get a boost for each loan paydown if aggregate remains elevated. I personally believe there is another aggregate threshold somewhere between 60% and 70% but influence on score is minor.
Has anyone gotten closer than my old loan testing data in terms of nailing down the range?
Been throwing cash at my 6.5% mortgage, might get my aggregate installment down to 70% by the end of the year and at that point I can go hunting but might take a bit since it's two mortgages rather than smaller loans.
@FicoMike0 wrote:
I myself have been wondering if a new installment loan resets the "Age of Youngest Account" metric.
It seems to. When I did my ssl, I got the "new account" reason code.
Yes but the real thing we need to know is whether it resets AoYA for purposes of scoreboard assignment. If so, it would likely cost me 26 points in EX FICO 8.