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loan paid off. down 13

expatCanuck
Super Contributor

loan paid off. down 13

Well.

That's annoying.

 

Paid off my personal loan (but still have a mortgage).  Other than a whack of recent pulls, thick clean file.

 

EX FICO 8 dropped from 808 to 795.  The other two bureaus really didn't care. (ETA - they in fact subsequently dropped 8 or 9 point).

 

FICO.

 

[aside - I paid off the 3-year loan a year early - wasn't gonna pay interest on $400 for a year - fiscal sense > FICO score]


2022 Goal: save 3 months' net income


Starting FICO8: 666 (give or take)
EQ8194 INQ (1 CC, 2 mort, car)7y6m
EX7926 INQ (4 CC, 2 mort)6y9m
TU8142 INQ (2 mort)6y3m
3/242/12AoYA 3m | AoOA 22.8y< 2%
[ Last INQ 14-Oct-2021 ]
Message 1 of 8
7 REPLIES 7
SouthJamaica
Super Contributor

Re: loan paid off. down 13


@expatCanuck wrote:

Well.

That's annoying.

 

Paid off my personal loan (but still have a mortgage).  Other than a whack of recent pulls, thick clean file.

 

EX FICO 8 dropped from 808 to 795.  The other two bureaus really didn't care.

 

FICO.

 

[aside - I paid off the 3-year loan a year early - wasn't gonna pay interest on $400 for a year - fiscal sense > FICO score]


Paying off the loan would not normally cause a score drop, unless the payoff caused your aggregate installment utilization percentage to go over 10% from below 10%.


Total revolving limits 693500 (600500 reporting) FICO 8: EQ 716 TU 729 EX 697

Message 2 of 8
dragontears
Valued Contributor

Re: loan paid off. down 13


@SouthJamaica wrote:

@expatCanuck wrote:

Well.

That's annoying.

 

Paid off my personal loan (but still have a mortgage).  Other than a whack of recent pulls, thick clean file.

 

EX FICO 8 dropped from 808 to 795.  The other two bureaus really didn't care.

 

FICO.

 

[aside - I paid off the 3-year loan a year early - wasn't gonna pay interest on $400 for a year - fiscal sense > FICO score]


Paying off the loan would not normally cause a score drop, unless the payoff caused your aggregate installment utilization percentage to go over 10% from below 10%.


This is what everyone always says but for me, every time I pay off a loan my FICO8 drops 5-10 points and I have an open mortgage that is only 3% paid off that makes the utilization of the smaller loans a non-factor in total loan utilization. 

 

Scores hover around 800
Haven't been AZEO in over a year
Rome was not built in a day, neither is a good credit profile
Message 3 of 8
expatCanuck
Super Contributor

Re: loan paid off. down 13


@dragontears wrote:

@SouthJamaica wrote:

@expatCanuck wrote:

Well.

That's annoying.

 

Paid off my personal loan (but still have a mortgage).  Other than a whack of recent pulls, thick clean file.

 

EX FICO 8 dropped from 808 to 795.  The other two bureaus really didn't care.

 

FICO.

 

[aside - I paid off the 3-year loan a year early - wasn't gonna pay interest on $400 for a year - fiscal sense > FICO score]


Paying off the loan would not normally cause a score drop, unless the payoff caused your aggregate installment utilization percentage to go over 10% from below 10%.


This is what everyone always says but for me, every time I pay off a loan my FICO8 drops 5-10 points and I have an open mortgage that is only 3% paid off that makes the utilization of the smaller loans a non-factor in total loan utilization. 


That's my experience as well.  I refi'd my mortgage in September.  The value of the personal loan was ~3% of my mortgage.  Without the loan, aggregate installment util is ~99%; with the loan, ~96%.

 

Bottom line: my monthly DTI is better (because I no longer have an additional monthly $450 payment), and my FICO score goes down.  That logic is whack.


2022 Goal: save 3 months' net income


Starting FICO8: 666 (give or take)
EQ8194 INQ (1 CC, 2 mort, car)7y6m
EX7926 INQ (4 CC, 2 mort)6y9m
TU8142 INQ (2 mort)6y3m
3/242/12AoYA 3m | AoOA 22.8y< 2%
[ Last INQ 14-Oct-2021 ]
Message 4 of 8
SouthJamaica
Super Contributor

Re: loan paid off. down 13


@dragontears wrote:

@SouthJamaica wrote:

@expatCanuck wrote:

Well.

That's annoying.

 

Paid off my personal loan (but still have a mortgage).  Other than a whack of recent pulls, thick clean file.

 

EX FICO 8 dropped from 808 to 795.  The other two bureaus really didn't care.

 

FICO.

 

[aside - I paid off the 3-year loan a year early - wasn't gonna pay interest on $400 for a year - fiscal sense > FICO score]


Paying off the loan would not normally cause a score drop, unless the payoff caused your aggregate installment utilization percentage to go over 10% from below 10%.


This is what everyone always says but for me, every time I pay off a loan my FICO8 drops 5-10 points and I have an open mortgage that is only 3% paid off that makes the utilization of the smaller loans a non-factor in total loan utilization. 

 


Well I side with the majority on thatSmiley Happy


Total revolving limits 693500 (600500 reporting) FICO 8: EQ 716 TU 729 EX 697

Message 5 of 8
expatCanuck
Super Contributor

Re: loan paid off. down 13

Postscript:

Email from Chase about positive changes in my credit history.  I log in to Credit Journey.

 

You paid off your account. Great!

Your total revolving balance has dropped. Terrific!

 

Oh, and your score is down 16.  Thanks for playing our game.  Have a nice day.

 

<smh>


2022 Goal: save 3 months' net income


Starting FICO8: 666 (give or take)
EQ8194 INQ (1 CC, 2 mort, car)7y6m
EX7926 INQ (4 CC, 2 mort)6y9m
TU8142 INQ (2 mort)6y3m
3/242/12AoYA 3m | AoOA 22.8y< 2%
[ Last INQ 14-Oct-2021 ]
Message 6 of 8
SouthJamaica
Super Contributor

Re: loan paid off. down 13


@expatCanuck wrote:

Postscript:

Email from Chase about positive changes in my credit history.  I log in to Credit Journey.

 

You paid off your account. Great!

Your total revolving balance has dropped. Terrific!

 

Oh, and your score is down 16.  Thanks for playing our game.  Have a nice day.

 

<smh>


Isn't that a Vantage score, rather than a FICO score?


Total revolving limits 693500 (600500 reporting) FICO 8: EQ 716 TU 729 EX 697

Message 7 of 8
expatCanuck
Super Contributor

Re: loan paid off. down 13

Indeed it is.  But the logic is still whack -- at the upper end, fiscal optimization != FICO optimization.

 

It reminds me of the BMI measure, which completely ignores the difference between fat and muscle.  But that's a discussion for a different forum.


2022 Goal: save 3 months' net income


Starting FICO8: 666 (give or take)
EQ8194 INQ (1 CC, 2 mort, car)7y6m
EX7926 INQ (4 CC, 2 mort)6y9m
TU8142 INQ (2 mort)6y3m
3/242/12AoYA 3m | AoOA 22.8y< 2%
[ Last INQ 14-Oct-2021 ]
Message 8 of 8
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