@Revelate wrote:
@azguy13 wrote:
@myjourney wrote:
@gen-specific wrote:my score is 700 today, opening one gets me to 770? lol thats a 10% increase after all
can you tell me more about how that works
The weight of that category is 10% but it won't necessarily add 10% (points) to your score if you have a loan thus giving you a 770 score
You wish Lol
I would add a $1,500 loan for a 70 point boost in a heartbeat. Sadly, even if I had no prior installment loans... it MAY give me 10 points after about 2 years
I don't know about that: even under FICO 04 I went from 571 to 595 just for having a installment loan report seemingly. People's mileage WILL vary at higher scores admittedly, but I don't think your 10 points over 2 years holds water honestly, I think it's a larger benefit than you suggest even when we're talking 760+ credit card only people when we're talking longer term: something that gets lost in the details, not every 760 even is created equally, why not make your file as strong as possible which includes a mix of tradelines if it is a trivial cost? Scraping together $500 for call it two weeks (for money shuffling time), I'm just not seeing a massive financial hardship for most people including anyone who has a savings acount as everyone recommends... a salient point to remember, it's not like a secured credit card where that money is gone for the period of time, you get the loan value right back in the secured loan type. Deposit $500, take out 100% LTV secured loan, wind up with $500 back in your pocket and a $7/month payment or whatever.
Also when we're talking things like car loans, it's a terrible idea not to have installment history on your reports... and if we ever move to the FICO 8 mortgage industry option, I shudder to think on not being possibly prepared on that one.
I guess frankly I don't understand: if we spend said yuppie foodstamp to look at our reports and scores, why wouldn't we spend the same one over the course of 4 years to IMPROVE our reports and scores. It's unarguable that having installment history is a benefit even if it's possibly not immediate for the gold plated credit card set under some models.
ETA: lot of the security deposits earn the same interest as savings accounts would at the various institutions, other than the inflation penalty on any liquid cash asset, what's the downside?
I am not arguing that it wouldn't help. I am simply stating that I personally would not go out of my way to take out a loan I do not need just so I can add some points to my scores. Yes, I understand the need for prior installment history when applying for an auto loan, I just would not take out any credit I do not need and pay any interest on it.
Plus, to be realistic, not many people have 760+ without having any previous installment history. I feel the benefit would be with scores in the 500s through mid/high 600s.
@azguy13 wrote:
@Revelate wrote:
@azguy13 wrote:
@myjourney wrote:
@gen-specific wrote:my score is 700 today, opening one gets me to 770? lol thats a 10% increase after all
can you tell me more about how that works
The weight of that category is 10% but it won't necessarily add 10% (points) to your score if you have a loan thus giving you a 770 score
You wish Lol
I would add a $1,500 loan for a 70 point boost in a heartbeat. Sadly, even if I had no prior installment loans... it MAY give me 10 points after about 2 years
I don't know about that: even under FICO 04 I went from 571 to 595 just for having a installment loan report seemingly. People's mileage WILL vary at higher scores admittedly, but I don't think your 10 points over 2 years holds water honestly, I think it's a larger benefit than you suggest even when we're talking 760+ credit card only people when we're talking longer term: something that gets lost in the details, not every 760 even is created equally, why not make your file as strong as possible which includes a mix of tradelines if it is a trivial cost? Scraping together $500 for call it two weeks (for money shuffling time), I'm just not seeing a massive financial hardship for most people including anyone who has a savings acount as everyone recommends... a salient point to remember, it's not like a secured credit card where that money is gone for the period of time, you get the loan value right back in the secured loan type. Deposit $500, take out 100% LTV secured loan, wind up with $500 back in your pocket and a $7/month payment or whatever.
Also when we're talking things like car loans, it's a terrible idea not to have installment history on your reports... and if we ever move to the FICO 8 mortgage industry option, I shudder to think on not being possibly prepared on that one.
I guess frankly I don't understand: if we spend said yuppie foodstamp to look at our reports and scores, why wouldn't we spend the same one over the course of 4 years to IMPROVE our reports and scores. It's unarguable that having installment history is a benefit even if it's possibly not immediate for the gold plated credit card set under some models.
ETA: lot of the security deposits earn the same interest as savings accounts would at the various institutions, other than the inflation penalty on any liquid cash asset, what's the downside?
I am not arguing that it wouldn't help. I am simply stating that I personally would not go out of my way to take out a loan I do not need just so I can add some points to my scores. Yes, I understand the need for prior installment history when applying for an auto loan, I just would not take out any credit I do not need and pay any interest on it.
Plus, to be realistic, not many people have 760+ without having any previous installment history. I feel the benefit would be with scores in the 500s through mid/high 600s.
Sure, and how much is a waste of $20? I've given away far more than that on things not remotely as important as a FICO score. I don't recommend someone finance a car they don't need necessarily (though financing a car they do need, well I did that even if it cost me more in the short term) but when we're talking about the share secured loan route, I don't think anyone's that frugal, and that rational analysis would find many many more $20's spent unnecessarily during any 4ish year span.
That's my point underlying it, if we agree that it's a benefit, at some point the cost is trivial, and I'm suggesting it should be for virtually anyone who has really taken a look at their personal finances.
ETA: oh I was off, it's actually $0.68 over a yuppie food stamp. Seriously $20.68 spent over 4 years isn't trivial? Done twice for FICO completeness at $41.36?
@gen-specific wrote:
@JCSC wrote:
I would not agree with getting a secured installment loan. I have one and it reports as "deposit related" and almost looks as if it counts negatively against my score. The comment of not having an installment loan is also present in my report.thanks for that insight
so I do not have any need for a car loan or a mortgage, and I have a unsecured line of credit so.... what else is there!?!? There is no way in hell I am going to get a real loan for no reason
Its only ten percent of your overall score , just fix the other parts of your report or just be patient
