shadu

Paying off car good or bad

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I have an really concerned abt this...

I had a scion XB which i traded in for mazda3 then 1mnt ago i traded in my mazda3 for Acura TSX and also sold my acura to get out of payments and do some savings for new home. But the question is now in 1 yr almost i have 3 cars paid off and closed XB,Mazda,Acura so what i wanna knw is that is this a good this for the credit score and reliability or a bad thing. WHat i think is that paying off for a car or loan or house should be considered a very good point to increase the scores but as i get into the bureaus system i am now really skeptical abt this. If its a bad impression on creditors or scores than my XB and Mazda still show up on my CR as paid so should I send a request to delete or remove the paid item or no.

Pls whoever has any idea or knowledge abt this issue let me knw

THanks

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Paying off debt is definitely a good thing for financial health in most cases, but it might be a bad thing in the case of installment loans that are not longer in length than your overall average account length. Sounds like these are very short loans. If that's the case, then it will probably have at least a slightly negative impact on your scores.

That being said, IMHO, the best thing to do is make wise financial decisions for your personal financial situation and let the FICO float around as it will. Some positive steps may not boost your score, but on the whole, your score will rise as you wisely manage your affairs.

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I lost 20 EX FICO points when my car loan reported as paid off.

There IS such a thing as installment utilization, and I'm now downgraded on FICO scores because my student loan balances are at their max (still deferred).

Anyhow, don't stress too much over it, do what makes financial sense. FICO will recover.

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