Potential score drop with new auto loan

[Anonymous]

I'm probably going to trade in my current ride for a new (used) car this week. I'm wondering if the gurus here can give me a ballpark idea of the effect this might have on my scores. My current loan is co-signed and I'd like to have a loan that's fully in my name, as well as take advantage of a 2% interest rate pre-approval from AAFCU. 

My current loan is right at one year and I've paid off 18% of the principal. 

If my calculations are correct my AAoA will drop from 30 mos to 28 mos. 

My youngest account is about a month old and I'm way past the point of the inquiry mattering, if there even is one. 

In my mind my score might not drop at all, but I feel like I'm missing something. Thanks in advance. 

[Thomas_Thumb]

---

@Anonymous wrote:

I'm probably going to trade in my current ride for a new (used) car this week. I'm wondering if the gurus here can give me a ballpark idea of the effect this might have on my scores. My current loan is co-signed and I'd like to have a loan that's fully in my name, as well as take advantage of a 2% interest rate pre-approval from AAFCU. 

My current loan is right at one year and I've paid off 18% of the principal. 

If my calculations are correct my AAoA will drop from 30 mos to 28 mos. 

My youngest account is about a month old and I'm way past the point of the inquiry mattering, if there even is one. 

In my mind my score might not drop at all, but I feel like I'm missing something. Thanks in advance. 

---

Your change in AAoA is a non event. Going from a B/L ratio of 82% currently to a new new loan at 100% B/L should not impact score. However, if the old loan closes and you get an updated score before the new one reports, you may see a temporary 10 point drop until it reports/you make an initial payment. A new inquiry could cost you 5 points but, no point loss for the new account itself.

Point changes are a bit of speculation. Actual data is welcome. Please report before/after data if you move forward.

[Anonymous]

---

@Thomas_Thumb wrote:

---

@Anonymous wrote:

I'm probably going to trade in my current ride for a new (used) car this week. I'm wondering if the gurus here can give me a ballpark idea of the effect this might have on my scores. My current loan is co-signed and I'd like to have a loan that's fully in my name, as well as take advantage of a 2% interest rate pre-approval from AAFCU. 

My current loan is right at one year and I've paid off 18% of the principal. 

If my calculations are correct my AAoA will drop from 30 mos to 28 mos. 

My youngest account is about a month old and I'm way past the point of the inquiry mattering, if there even is one. 

In my mind my score might not drop at all, but I feel like I'm missing something. Thanks in advance. 

---

Your change in AAoA is a non event. Going from a B/L ratio of 88% currently to a new new loan at 100% B/L should not impact score. However, if the old loan closes and you get an updated score before the new one reports, you may see a temporary 10 point drop until it reports/you make an initial payment.

Point changes are a bit of speculation. Actual data is welcome. Please report before/after data if you move forward.

---

OK, thank you. I will update with some concrete data if I go through with the new loan. 

[Anonymous]

TT gives good info above.  Another thing, you said your youngest account is 1 month old, so your AoYA will not drop, meaning you will not get a ding there.  Also as TT stated, you will not cross an AAoA threshold either, so no scoring drop from that.  Finally, the inquiry.  That really depends on how many other scoreable inquiries you have currently.  It could result in 0 point drop.  It could be a couple of points.  At most, maybe 6-8 points depending on your file and the bureau you're talking.

I agree with what TT said regarding the loan utilization as well.  Since your current loan isn't significantly paid down, you'll likely see little to no scoring drop based on your installment loan utilization raising slightly when the new loan reports.  If your current loan was already low and just about to be paid off you'd see a scoring drop for sure when switching to a loan that's at 100% utilization.

[SouthJamaica]

---

@Anonymous wrote:

I'm probably going to trade in my current ride for a new (used) car this week. I'm wondering if the gurus here can give me a ballpark idea of the effect this might have on my scores. My current loan is co-signed and I'd like to have a loan that's fully in my name, as well as take advantage of a 2% interest rate pre-approval from AAFCU. 

My current loan is right at one year and I've paid off 18% of the principal. 

If my calculations are correct my AAoA will drop from 30 mos to 28 mos. 

My youngest account is about a month old and I'm way past the point of the inquiry mattering, if there even is one. 

In my mind my score might not drop at all, but I feel like I'm missing something. Thanks in advance. 

---

It's likely that there will be little impact.  You'll be going from an 82% utilization loan to a 100% utilization loan, so there might be a small point loss from that in FICO 8, and an even smaller loss in a couple of other scoring models. But it shouldn't be much, and it should come back soon.