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Refinancing Cash out Score Changes

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CAS2019
Frequent Contributor

Refinancing Cash out Score Changes

Hi!  I refinanced my condo for a lower rate, and took $20,000 cash out to pay off bills and remodeling.  I closed Nov 3rd and I paid off a personal loan, as well as a couple of credit cards.  The original mortgage loan payoff hit the CRA's (I'm guessing) Thursday and the personal loan a week and a half ago.  This morning, my EX fico score dropped 5 points (768 to 763), but my TU dropped 17 points (774 to 757).  When the new mortgage hits, should I expect additional points loss?  The comments in My FICO did state the points loss was due to the mortgage payoff.

 

Thanks for any info!

Starting Score: 784
Current Score: 784
Goal Score: 800


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Phana24
Regular Contributor

Re: Refinancing Cash out Score Changes


@CAS2019 wrote:

Hi!  I refinanced my condo for a lower rate, and took $20,000 cash out to pay off bills and remodeling.  I closed Nov 3rd and I paid off a personal loan, as well as a couple of credit cards.  The original mortgage loan payoff hit the CRA's (I'm guessing) Thursday and the personal loan a week and a half ago.  This morning, my EX fico score dropped 5 points (768 to 763), but my TU dropped 17 points (774 to 757).  When the new mortgage hits, should I expect additional points loss?  The comments in My FICO did state the points loss was due to the mortgage payoff.

 

Thanks for any info!


Yeah, since the new mortgage will be a high utilization, you'll take another hit.  How much of a hit will depend upon what UT you had on the previous mortgage.  If you can throw some extra on your mortgage payments for a while, it will help you recover sooner. 

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CAS2019
Frequent Contributor

Re: Refinancing Cash out Score Changes

Thanks!  I actually told the bank to take out an additional $300 per month towards the principal when I closed escrow.  I was saving so much, I could do this without any trouble.  What is so weird (and to show you how different the algorithms are), I lost points with my FICO scores, but I GAINED points with Vantage.  According to them (Vantage), I am debt free.  Of course, once the new mortgage kicks end, I fully expect the scores to go down.  I was just hoping that perhaps I wouldn't lose anymore fico points.  My cc aggragrate never went beyond 20% pre refi (currently, it's 2%), and the highest one cc debt was 27%.   Hopefully, the point loss won't be massive.

 

Again, thank you!

Starting Score: 784
Current Score: 784
Goal Score: 800


Take the myFICO Fitness Challenge

Club Member" border="0" width="50" height="67" align="right">

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