Board 8 > It happened to me: I paid off a car and my credit went down

(+) Yeah! (+)

Incredibly stupid system we have.

Literally the worst

So this comes from having one less "line of credit" active?

Or from reducing the average age of your remaining credit lines?

Forceful_Dragon posted...

So this comes from having one less "line of credit" active?

It's more of this.

I don't carry my Debit card anymore.

while stupid, caring about your credit number is pretty pointless unless you are going to make a large purchase soon. Or it's complete shit i guess, but i'd assume you have bigger money problems if that is the case.

Credit number basically is meaningless unless you are brand new to credit or are way overutilizing it and not paying off bills.

You basically need something like a 650 to be considered top credit, which is really really easy and not going to be affected by paying off a car loan

Yeah, your credit score is pretty unimportant most of the time. I wouldn't worry about it too much unless you're needing a loan sometime in the near future.

masterplum posted...

Credit number basically is meaningless unless you are brand new to credit or are way overutilizing it and not paying off bills.

You basically need something like a 650 to be considered top credit, which is really really easy and not going to be affected by paying off a car loan

The way credit works is stupid but there's no way 650 is anywhere close to being top credit.

My wife had a credit rating of high 600s. Mine is just over 800. The difference in rates she was offered when getting a new car was massively different to the rates I could get if I put it in my name instead (which is obviously what we did)

A quick glance at a mortgage calculator has a 1.4% rate difference on a 30 year mortgage between 650 and 780 which is a sizeable difference on 30 years worth of interest.

800 is definitely different than 650. But 650 is when it becomes "not bad"

The dumbest thing about credit is there's 2 completely separate numbers, revolving vs installment. And you can only build installment credit score by intentionally overpaying on interest.

Well yeah but I wouldn't say 650 gets you top credit. Usually they list ranges as Poor, Fair, Good, Very Good, Exceptional and 650 is still classed as Fair.

I'd say that it isn't until 720 ish where things get reasonable which is around the middle of the middle category (Good)

I used to work in car sales, 715 was generally the number(or around there) which wouldn't rip you off.