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Unpopular opinion: I was happy to see a 40 point drop on my report.
It was from paying off my car loan in Seattle, which closed the account. Now I know my score will bounce back in a few months, but has anyone else felt weirdly relieved finishing a big debt even with the temporary hit?
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david_craig5mo ago
Wait, your score dropped FORTY points just from paying off a car? That seems crazy to me. My score only moved like five points when I paid off my student loan. What kind of scoring model are they even using that punishes you for being responsible? Does it matter which bank you had the loan with?
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skylerm552mo ago
Same thing happened to me with my car loan a few years back, dropped 35 points out of nowhere. @jana_price explained it perfectly, the system just freaks out when that installment account vanishes from your profile.
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jana_price5mo ago
The scoring models really hate when you close your only installment loan. In my case, my car loan was my oldest account by a decade. When I paid it off, my "credit mix" went from good to just credit cards, and the average age of my accounts took a huge hit. It didn't matter which bank it was with, the system just saw a long history suddenly gone. It's less about punishing responsibility and more about the algorithm losing a key data point it liked. It usually bounces back in a few months, but that first drop is a real shock.
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