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Score drop with paid Auto but still have installments

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nyuphoto
Regular Contributor

Score drop with paid Auto but still have installments

Hello,

All 3 scores dropped 14-20 points when my auto was paid. However, I still have a mortgage and the NEW auto loan reported to all 3 CRA's BEFORE the trade-in was reported paid off. I understand that if it was my only installment loan I'd take a major hit but that's not the case. Any insight on this? 

Cards (In order of approval) TCL: 137k

Chase Home Mortgage 402k 3.25% 30yr | 10/2021 | AU  
App’d for my first CC in April 2020, hoping for a 3k SL… Anyone can turn their credit around.
Message 1 of 14
13 REPLIES 13
nyuphoto
Regular Contributor

Re: Score drop with paid Auto but still have installments

DP's:

1. Trade-in auto loan was from 9/2018 high balance of 40k and owed balance before pay off was 30k.Reported paid 8/7/2020

2. New auto loan is 41.5k. This loan reported before the payoff 8/1/2020. All 3 CRA's showed total owed in auto installments was 71k. 

3. Mortgage is from 1/2020 for 199k high balance and roughly 197k owed. 

Cards (In order of approval) TCL: 137k

Chase Home Mortgage 402k 3.25% 30yr | 10/2021 | AU  
App’d for my first CC in April 2020, hoping for a 3k SL… Anyone can turn their credit around.
Message 2 of 14
randomguy1
Valued Contributor

Re: Score drop with paid Auto but still have installments

I think you might want to calculate your aggregate utilization % before and after. 

Message 3 of 14
nyuphoto
Regular Contributor

Re: Score drop with paid Auto but still have installments

For installments:

96% --> 99% Aggregate Utilization (if the new auto loan was in fact counted)

 

95% --> 99% (if new auto loan not counted)

 

These include the mortgage. 

Cards (In order of approval) TCL: 137k

Chase Home Mortgage 402k 3.25% 30yr | 10/2021 | AU  
App’d for my first CC in April 2020, hoping for a 3k SL… Anyone can turn their credit around.
Message 4 of 14
randomguy1
Valued Contributor

Re: Score drop with paid Auto but still have installments


@nyuphoto wrote:

For installments:

96% --> 99% Aggregate Utilization (if the new auto loan was in fact counted)

 

95% --> 99% (if new auto loan not counted)

 

These include the mortgage. 


Was the trade in a loan?

 

are you including that in your aggregate numbers? 

Message 5 of 14
nyuphoto
Regular Contributor

Re: Score drop with paid Auto but still have installments

Yes the trade in was a loan. I owed 30k and original loan amount was 40k. Both scenarios include this in the aggregate amounts. 

Cards (In order of approval) TCL: 137k

Chase Home Mortgage 402k 3.25% 30yr | 10/2021 | AU  
App’d for my first CC in April 2020, hoping for a 3k SL… Anyone can turn their credit around.
Message 6 of 14
SouthJamaica
Mega Contributor

Re: Score drop with paid Auto but still have installments


@nyuphoto wrote:

Hello,

All 3 scores dropped 14-20 points when my auto was paid. However, I still have a mortgage and the NEW auto loan reported to all 3 CRA's BEFORE the trade-in was reported paid off. I understand that if it was my only installment loan I'd take a major hit but that's not the case. Any insight on this? 


I don't see the mystery. You went from 2 barely paid off loans to 3 barely paid off loans in your reports. I would expect your credit scores to lose a bit as your debt load was seen to increase.

 

 


Total revolving limits 741200 (620700 reporting) FICO 8: EQ 701 TU 704 EX 685

Message 7 of 14
nyuphoto
Regular Contributor

Re: Score drop with paid Auto but still have installments

That's sounds nice on paper but according to Fico scoring 1 installment loan is needed to maximize scores. My installment loan aggregate utilization changed 3 maybe 4%. My aggregate revolver utilization is 1%. Help me understand how 4% change should be a no brainer in dropping double digit points when I replaced a paid off loan with another loan and total aggregate changed a mere 3%. 


@SouthJamaica wrote:

@nyuphoto wrote:

Hello,

All 3 scores dropped 14-20 points when my auto was paid. However, I still have a mortgage and the NEW auto loan reported to all 3 CRA's BEFORE the trade-in was reported paid off. I understand that if it was my only installment loan I'd take a major hit but that's not the case. Any insight on this? 


I don't see the mystery. You went from 2 barely paid off loans to 3 barely paid off loans in your reports. I would expect your credit scores to lose a bit as your debt load was seen to increase.

 

 


 

Cards (In order of approval) TCL: 137k

Chase Home Mortgage 402k 3.25% 30yr | 10/2021 | AU  
App’d for my first CC in April 2020, hoping for a 3k SL… Anyone can turn their credit around.
Message 8 of 14
nyuphoto
Regular Contributor

Re: Score drop with paid Auto but still have installments

To be clear with data points: 

I went from 2 loans to 3 loans and  back to 2 loans. All within less than a week. I traded a car in and literally paid off a loan and replaced it with another loan. 

Installment aggregate 97% to 99%. 
Revolver aggregate 1%. 

20 point drop in FICO 8. 

Cards (In order of approval) TCL: 137k

Chase Home Mortgage 402k 3.25% 30yr | 10/2021 | AU  
App’d for my first CC in April 2020, hoping for a 3k SL… Anyone can turn their credit around.
Message 9 of 14
SouthJamaica
Mega Contributor

Re: Score drop with paid Auto but still have installments


@nyuphoto wrote:

That's sounds nice on paper but according to Fico scoring 1 installment loan is needed to maximize scores.

 

You already had 2 before the new loan reported.

 

My installment loan aggregate utilization changed 3 maybe 4%.

 

Not especially impactful.

 

My aggregate revolver utilization is 1%.

 

Another subject entirely.

 

Help me understand how 4% change should be a no brainer in dropping double digit points when I replaced a paid off loan with another loan and total aggregate changed a mere 3%. 

 

You yourself said that the new loan had reported but the paid off loan hadn't. So as far as your reports are concerned you now had 3 barely paid off loans instead of 2.

 

You keep coming back to a 3% change in installment utilization percentage but I don't understand why.

This is not a significant milestone; it is virtually meaningless. And this is not the reason your score went down. It went down because as far as the reported data is concerned, you've taken on more debt.

 


@SouthJamaica wrote:

@nyuphoto wrote:

Hello,

All 3 scores dropped 14-20 points when my auto was paid. However, I still have a mortgage and the NEW auto loan reported to all 3 CRA's BEFORE the trade-in was reported paid off. I understand that if it was my only installment loan I'd take a major hit but that's not the case. Any insight on this? 


I don't see the mystery. You went from 2 barely paid off loans to 3 barely paid off loans in your reports. I would expect your credit scores to lose a bit as your debt load was seen to increase.

 

 


 


 


Total revolving limits 741200 (620700 reporting) FICO 8: EQ 701 TU 704 EX 685

Message 10 of 14
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