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Paid off a loan and credit score DROPPED 30 points !

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Member

Paid off a loan and credit score DROPPED 30 points !

I paid off one of my student loans this month, and today I got an update from Experian saying that 1) the account was marked closed paid and 2) my score dropped 30 points.

 

Experian has one other student loan that's about 50% paid off at $2,500, but doesn't seem to be reporting original balance or usage, just current balance. Could that affect it?

 

Equifax also dropped, and the paid-off loan was the only installment account being reported. Would it be worth opening an SSL somewhere like NFCU to get another installment account on Equifax?

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Valued Contributor

Re: Paid off a loan and credit score DROPPED 30 points !

It might be simpler to try to get the 50% student loan to report the original balance. Call the loan company and see if they can get the reporting updated.

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Established Contributor

Re: Paid off a loan and credit score DROPPED 30 points !

If you don't need a loan, I wouldn't get one just for points

finances before score.  

 

be happy you paid off a loan!

 

also, there are account reporting discrepancies between the main 3- so your score will never lineup anyway

 

i have a bank that reports 2 accounts to Ex. Never has reported to TU.  

it just doesn't matter.  

 

 

July 31/2019. EX-712. EQ-704. TU-726
Dec 16/2019. EX. 721. EQ. 723. TU 746
Aug 8/2020 EX. 728 EQ. 714 TU 744
Sept 18/2020 EX. 728 EQ. 726 TU 752
Inq. EX 6 EQ 4 TU 2 - - CC 5x24, 1x12
Amex BCP $20k - Apple GS $15k - BMW/Elan $5k - Cap1 QS $16.7k - Chase Amazon $13.6k - Chase United Club Infinite $20k - Citi DC $14.5k - CreditUnion1 $9k - DiscoverIT $20.5k - HSBC Gold - $10.5k - Wells Sig Visa $12k
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Super Contributor

Re: Paid off a loan and credit score DROPPED 30 points !


@dskjsdalk wrote:

I paid off one of my student loans this month, and today I got an update from Experian saying that 1) the account was marked closed paid and 2) my score dropped 30 points.

 

Experian has one other student loan that's about 50% paid off at $2,500, but doesn't seem to be reporting original balance or usage, just current balance. Could that affect it?

 

Equifax also dropped, and the paid-off loan was the only installment account being reported. Would it be worth opening an SSL somewhere like NFCU to get another installment account on Equifax?


I don't think that would help in this situation. Probably what happened is your aggregate installment utilization went up when the loan got paid off. If the remaining open loan isn't being reported properly you might want to dispute that, as it should show the original loan amount and the current balance. If that's your only loan, once it's down to 9% of the original loan amount you should get a bonus in your FICO 8 scores.

 

Take comfort in the fact that the mortgage scores are much less impacted by this kind of thing.


Total revolving limits 654000 (575000 reporting) FICO 8 EQ 714 TU 731 EX 713

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Super Contributor

Re: Paid off a loan and credit score DROPPED 30 points !

I'd suggest trying to get that other loan to report properly.

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