I just paid off a loan, it was for $9000 how will this change my credit score?(I know there would be a lot of variables involved in that) I know closing credit cards may decrease your score, but now that this loan is paid off my score should increase once its is reflected on my credit report right?
Your credit score will increase dramatically if you paid the loan off sooner than it was supposed to be paid off.
It will raise your score a little because you will be loweing your overall debt ratio.
However this is only one small part of a credit score. Total outstanding debt does not play a very large role in your score. Its more important how timley you pay over the years, and how much of a credit line you have.
I would expect a 10-20 point increase with the next couple months.
Yes, paying off a debt will increase your score. Ideally, the less debt you have the better your score will be. Though early, depends on how early. While you may boost your score, you may be shocked to discover that some loans penalize you for paying in advance because that means they make less money off your interest. (Be sure to check the fine print) But in the area of your credit score, you’re sure to get a nice little boost whenever your debt is gone.
It doesn’t take long for short term changes like account balances, payments, and available credit to show up on your credit report and effect your score — likely these are the things to have impact over the short term, and you have a better change of fixing your score if you try to address one of those issues, which you can do easily in a matter of weeks.
Let me share with you my tips that you can use to build your credit score quickly. I raised mine to well over 700 points fro 500 using these steps in less than a year — :
# Know and Track Your Credit Score (be sure to sign up for the free trial of your credit score tracking listed below. It really helped my get my score up.)
# Never Miss a Payment, Starting Today
# Never use more than 20% of your Available Credit
# Keep Credit Cards that Have No Annual Fees Open For as Long as Possible
# Extend Your Credit Limit on Cards You Already Have before You Get New Ones
# Get Credit Cards that Have CashBack Rewards to Contribute to your Balance
# Transfer Your Balance to a Credit Card with a Lower Interest Rate and a Higher Available Credit-
# If You Think You Are Going to be FORCED to Pay a Bill Late Ask for an Extension or Payment Plan
# Take out a Small Personal Loan and Repay it Over a Year
# Ask Someone With Good Credit if They will Account Shadow you
Read more here:
10-Ways to Boost Your MyFico Score
http://millionster.com/articles/debt/increase-fico-credit-score/
When you’re trying to build a solid credit score it’s important to get a comprehensive view of what is actually effecting it…
Your Credit Score (also known as your MyFico score) is calculated with the following breakdown:
35% – Payment History
30% – Credit to Debt Ratio
15% – Credit History
10% – New Credit
10% – Credit Types in Use
If you excel in one area and lack in another, only fixing the areas which you lack are going to improve your score
Best of luck to you, I hope this info helps you figure your credit situation out!