Ready to quit!

[Anonymous]

So I woke up to this.... I paid off my 23k in student loan debt. It's closed and paid in full. Why would it cause my score to drop 50 points!!! This is confusing to me. I keep paying things off and I keep seeing my score drop and drop.. when do I start to see it go up?

[Azuieldrago]

Did it list why it dropped? If it is because of the loans, you went from an active account to closed. Do you have any other items reporting to help balance out?

[thornback]

Was this/they your only active installment loan(s)?  

[Anonymous]

I have self lender which I just recently opened. I have have 3 secured credit cards. I have some other things in collections installment and revolving that I plan to have paid off within the next 45 days.

[thornback]

What was the total original loan amount?  

[Anonymous]

I don't recall the exact amount but it was just over 23k

[NimbusIII]

It sounds like your moving in the right direction even though the score is not.  Once the other derogatory accounts are cleared, the secured cards graduate and you get some time under your loan you should be looking pretty good. I've seen scores jump a 100+ points once everything falls in line.  

[thornback]

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@Anonymous wrote:

I don't recall the exact amount but it was just over 23k

---

So, the loan wasn't already significantly paid down prior to paying it off completely;  and your self-lender, I assume, is still close to 100% util? 

If that's the case, you wouldn't have been dinged for increased aggregate loan util (at least not by that much), nor for closing your only active installment... 

FICO scores loan utilization as an aggregate -- so total loan balances/total loan amounts.   Often, when someone pays off one of their active loans, their aggregate util increases significantly, causing a score drop.  That doesn't seem to be the case here (though we cannot say for sure without exact numbers).

Even if increased loan util was a factor  -- I don't think i've ever seen such a severe loss of points -- 50 points is a heck of a lot.  I think the most I've seen from paying off loans is ~30-35 points.

Is that a myFICO credit alert?   

[Anonymous]

its on Experian I pay for the membership over there. 

[Azuieldrago]

Correct me if I am wrong, could it have been a few things dropping it and not just the one item. 

1. Closed account

2. New Account

3. Lowered age

4. New loan reporting a high utilization rate?

5. Inquiry for the new loan?

Just spit balling here of the possibilities. May not have been one thing but a combination?

Are the secured cards new too? Maybe they are catching up in reporting?