I just paid off my car loan. I was never late on a payment and I see on my credit report is listed under a possitive account category. Will this loan be considered for years to come in determing my credit score. Or once a loan is paid off is it like it doesn’t exsist?
Will A Loan That Is Paid Off Continue To Effect My Credit Score?
July 31st, 2009 by Home Loans Leave a reply »
Advertisement
This account will remain on your report, as part of your credit history.
It will remain on you credit report for, I believe, 10 years from the last payment (since it is a positive entry and not a derogatory one). But that is a good thing. It helps your score.
The FICO score benefits from having a variety of TYPES of loans — so it’s good to show an installment loan (car), some credit cards, and a mortgage, ideally.
The point of FICO is to predict how reliable you are at paying debts you take on. A good car loan history is positive.
It actually leaves a positive mark and is considered when applying for credit in the future. Creditors see pymnt history, especially, pymnt history that fell through…. You see, a loan (car, personal, mortgage, etc), is like you giving the bank your word that if they loan you, x amount of dollars, then you’ll py it back w/ y interest w/ in z amt of time….to follow through w/ the agreement and py the bank in full, shows them that you’re stable and are a person who’s “word” is WORTH investing in……if that helps you ne
It will remain on your credit and be used to calculate your score for the normal amount of time (I believe its 7 years). Because it is a positive item on the report its good that it stays on there.
Congrats! You have a perfect (HIGH) credit rating.
This will remain with you for many years, but I’m sure there is a limit. I don’t think a 95 year old person is carrying a credit score from when he/she was 18 years old. Now, if you are late with payments, that may stay on your record for a longer time. Why not look at the back of a credit
card or a monthly statement for a phone number and call them. As part of customer service, they might tell you directly. Good luck
no.