Open up small mortgage loan to improve FICO??

5 months ago

Thu Apr 18, 2024 10:50 am

Slabenstein

OutlierDinosaurs are patriots

Slabenstein has passed the 24 month threshold and is completely inquiry free!
Slabenstein has achieved the Garden Goal !!

Level24 Last INQThursday, September 1, 2022 Gardening For2 years, 6 days, 20 hours, and 44 minutes Next Level in23 days, 3 hours, and 16 minutes on October 1st INQ 1yr onFriday, September 1, 2023 INQ 1yr reached1 year, 6 days, 20 hours, and 44 minutes ago INQ 2yr onSunday, September 1, 2024 INQ 2yr reached6 days, 20 hours, and 44 minutes ago Goal24 months Goal DateSunday, September 1, 2024 Goal Achieved6 days, 20 hours, and 44 minutes ago

This wouldn't be worth doing. My FICO's didn't change at all when my mortgage reported; to my knowledge, mortgages aren't scored differently from other installments.

Maybe more importantly, the only mortgage product that would be available in the dollar range you're talking about would be a home equity loan. But for a home equity loan you have to already own property with equity to put up as collateral, and they report differently than first mortgages, anyway.

5 months ago

Thu Apr 18, 2024 1:55 pm

Dinosaur

Seasoned RebelDinosaur

Level4 Last INQMonday, April 8, 2024 Gardening For4 months, 30 days, 20 hours, and 44 minutes Next Level in3 hours and 16 minutes on September 8th INQ 1yr onTuesday, April 8, 2025 INQ 1yr in7 months, 3 hours, and 16 minutes INQ 2yr onWednesday, April 8, 2026 INQ 2yr in1 year, 7 months, 3 hours, and 16 minutes Goal24 months Goal DateWednesday, April 8, 2026 Goal In1 year, 7 months, 3 hours, and 16 minutes

Slabenstein wrote: ↑Thu Apr 18, 2024 10:50 am This wouldn't be worth doing. My FICO's didn't change at all when my mortgage reported; to my knowledge, mortgages aren't scored differently from other installments. Maybe more importantly, the only mortgage product that would be available in the dollar range you're talking about would be a home equity loan. But for a home equity loan you have to already own property with equity to put up as collateral, and they report differently than first mortgages, anyway.

Or a Home Equity Line of Credit that can be paid down and reused as needed for the life of the product. Generally, the life runs 5, 10, 15 or 20 years. Rate variable and usually pegged close to the Federal Reserve Rate. May appear in the credit bureaus as a mortgage or other. My HELOC appeared as other. Also, did not find huge effects when paid off the mortgages. Likely because I had an installment loan plus a Mortgage and HELOC. Do note however when I paid off the installment loan there was a significant score adjustment.

5 months ago

Sun Apr 21, 2024 1:28 pm

NoMoneyNoHoney

Seasoned RebelNeed BTC card

NoMoneyNoHoney has passed the 12 month threshold!
No scorable inquiries on file!

Level20 Last INQSunday, January 1, 2023 Gardening For1 year, 8 months, 6 days, 20 hours, and 44 minutes Next Level in23 days, 3 hours, and 16 minutes on October 1st INQ 1yr onMonday, January 1, 2024 INQ 1yr reached8 months, 6 days, 20 hours, and 44 minutes ago INQ 2yr onWednesday, January 1, 2025 INQ 2yr in3 months, 24 days, 3 hours, and 16 minutes

Dinosaur wrote: ↑Thu Apr 18, 2024 1:55 pm
Slabenstein wrote: ↑Thu Apr 18, 2024 10:50 am This wouldn't be worth doing. My FICO's didn't change at all when my mortgage reported; to my knowledge, mortgages aren't scored differently from other installments. Maybe more importantly, the only mortgage product that would be available in the dollar range you're talking about would be a home equity loan. But for a home equity loan you have to already own property with equity to put up as collateral, and they report differently than first mortgages, anyway.
Or a Home Equity Line of Credit that can be paid down and reused as needed for the life of the product. Generally, the life runs 5, 10, 15 or 20 years. Rate variable and usually pegged close to the Federal Reserve Rate. May appear in the credit bureaus as a mortgage or other. My HELOC appeared as other. Also, did not find huge effects when paid off the mortgages. Likely because I had an installment loan plus a Mortgage and HELOC. Do note however when I paid off the installment loan there was a significant score adjustment.

Thanks. I do have two personal loans on file. What is the threshold where you need to get the balances to get a score increase?? For example, I've paid off around 60% of the loans, if I got to 70% would that be huge score increase? Is it the same as for credit cards? Where every time you get 10% paid off (say you go from 69% utilizaton to 59% utilization) you get a score increase?? I couldnt find much info on how the installment loans effect your credit score. The issue is my loans are only 5.9% interest rate. But I got over $54K of unsecured credit card debt. Most is under 0% offers right now but they are expiring soon, so I dont want to focus too much on the loans since the other debt could be extremely high interest once the special 0% balance transfer offers expire. I'm working on trying to get another balance transfer card. There's also some strategy with that since I have to very careful who I choose nexts since my FICO isnt that high (but not horrible either).

5 months ago

Tue Apr 23, 2024 12:13 pm

Slabenstein

OutlierDinosaurs are patriots

Slabenstein has passed the 24 month threshold and is completely inquiry free!
Slabenstein has achieved the Garden Goal !!

Level24 Last INQThursday, September 1, 2022 Gardening For2 years, 6 days, 20 hours, and 44 minutes Next Level in23 days, 3 hours, and 16 minutes on October 1st INQ 1yr onFriday, September 1, 2023 INQ 1yr reached1 year, 6 days, 20 hours, and 44 minutes ago INQ 2yr onSunday, September 1, 2024 INQ 2yr reached6 days, 20 hours, and 44 minutes ago Goal24 months Goal DateSunday, September 1, 2024 Goal Achieved6 days, 20 hours, and 44 minutes ago

NoMoneyNoHoney wrote: ↑Sun Apr 21, 2024 1:28 pm
Dinosaur wrote: ↑Thu Apr 18, 2024 1:55 pm
Slabenstein wrote: ↑Thu Apr 18, 2024 10:50 am This wouldn't be worth doing. My FICO's didn't change at all when my mortgage reported; to my knowledge, mortgages aren't scored differently from other installments. Maybe more importantly, the only mortgage product that would be available in the dollar range you're talking about would be a home equity loan. But for a home equity loan you have to already own property with equity to put up as collateral, and they report differently than first mortgages, anyway.
Or a Home Equity Line of Credit that can be paid down and reused as needed for the life of the product. Generally, the life runs 5, 10, 15 or 20 years. Rate variable and usually pegged close to the Federal Reserve Rate. May appear in the credit bureaus as a mortgage or other. My HELOC appeared as other. Also, did not find huge effects when paid off the mortgages. Likely because I had an installment loan plus a Mortgage and HELOC. Do note however when I paid off the installment loan there was a significant score adjustment.
Thanks. I do have two personal loans on file. What is the threshold where you need to get the balances to get a score increase?? For example, I've paid off around 60% of the loans, if I got to 70% would that be huge score increase? Is it the same as for credit cards? Where every time you get 10% paid off (say you go from 69% utilizaton to 59% utilization) you get a score increase?? I couldnt find much info on how the installment loans effect your credit score. The issue is my loans are only 5.9% interest rate. But I got over $54K of unsecured credit card debt. Most is under 0% offers right now but they are expiring soon, so I dont want to focus too much on the loans since the other debt could be extremely high interest once the special 0% balance transfer offers expire. I'm working on trying to get another balance transfer card. There's also some strategy with that since I have to very careful who I choose nexts since my FICO isnt that high (but not horrible either).

Thresholds for installment utilization aren't as well understood as those for revolving, I think partly because the point awards and penalties are so much lower and partly because installment utilization can't really be manipulated month-to-month for testing the way revolving can. To my knowledge, the only utilization scoring for installments is aggregate. According to Birdman's scoring primer, there's a known threshold at 9.5% agg util that gives largest points reward, and there may be smaller rewards at about 65% and 88%. For what to focus on paying off, I would choose finances over FICO and attack your highest-interest debt first while also looking to reduce your interest rate where you can. So new 0% BT if you can get it, debt consolidation loan on what's left if that will reduce your rate, and then pay down the balances that are costing you the most to carry as aggressively as you can.