"mortgage" scored differently than "installment"?

[thankfulheart]

I know it's just a FAKO, but my USAA CMC EX dropped 10 points with the only change being a "2nd mortgage" being paid off.  I had a replacement installment loan that reported last week with no score change at all, so just wondering if my score will suffer now that I don't have a "mortgage" anymore. Installment-wise, I have a car, a signature loan, and student loans.

[marty56]

I have seen different view here on the effect of installment loans and what happens when they are PIF'd but I know you can have FICO scores over 800 without them and certianly high enough to get any type of credit at the best rates.

IMHO I would say no to your question.

[rckstrscott]

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@marty56 wrote:

I have seen different view here on the effect of installment loans and what happens when they are PIF'd but I know you can have FICO scores over 800 without them and certianly high enough to get any type of credit at the best rates.

IMHO I would say no to your question.

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I agree... your mix might change a little, and you might lose a little here and there, but that is true with almost all of FICO movements..

-scott

[pizzadude]

I have seen FAKO scoring advice that considers mortgage accounts to be the "highest quality" tradeline ~ I'd ignore them and their advice.    As far as I can tell, installment loans are pretty much all the same from a FICO perspective.

[RobertEG]

From what I have read, mortgage accounts are not a primary risk predictor in FICO scoring.

They are probably the one debt that is most likely to be paid first should things get tough.  Thus, they are not an early predictor of risk of delinquency.

Use of discretionary, revolving credit is usually the first indicator of potential consumer risk, with the ability to acquire additional debt up to the approved credit limit without express approval.  What is most likely to become delinquent in tough times?  CC payments.

Within the realm of installment credit, I would also suspect that unsecured loans are given more predictive weight based on the lack of immediate threat of loss of secured personal property.

[Revelate]

FICO may or may not adjust for mortgages, but I heard back in my druken diplomacy days from a guy who should know, that a mortgage does contribute to what bucket you get dumped into.

Also, FICO is only part of the equation when it comes to lenders: lenders absolutely like mortgages. on one's report... there's nothing else on a credit report that screams stability quite like a mortgage.

[bettercreditguy1]

My wife has a TU Fico at 810 and EQ at 803. Her current reports have no mortage, no installment/personal loans, a paid off car loan fifteen years ago, and several active credit card accounts.

[stan_the_man]

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@rckstrscott wrote:

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@marty56 wrote:

I have seen different view here on the effect of installment loans and what happens when they are PIF'd but I know you can have FICO scores over 800 without them and certianly high enough to get any type of credit at the best rates.

IMHO I would say no to your question.

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I agree... your mix might change a little, and you might lose a little here and there, but that is true with almost all of FICO movements..

-scott

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I don't think the mix has changed because the original loan is still reporting -- maybe the FAKO treats it differently.

[pizzadude]

Yep, this is yet another factor that is different between FAKO and FICO® scoring. You just can't correlate them.