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| *Loan,banking and credit>>>auto loan |
I have a credit score of 520. I recently got an auto loan. I was wondering how much it will raise my score? |
All payments will be made on time. Installment accounts (such as a loan) have very little impact on your credit score. In fact, your application for the loan likely lowered your credit score, as both credit inquiries and new accounts count against your score. The breakdown of your credit score is as follows: 35% payment history 30% credit usage 15% length of credit history 10% new accounts and credit applications 10% credit mix I assume by your score that you have late payments in your history. The good news is that each month that passes, assuming you have no more late payments, improves both your payment history and length of credit history. The loan really only affects your credit mix. Payment history and credit usage are largely based on revolving accounts (credit, not loans). If you really want to improve your score, you need to try and open some credit acounts. It will be difficult with your current scores, but check into things like secured credit cards. Once you establish some credit accounts, don't run up your balances. Charge something small each month (never charge more than 30% of your total available credit limit in total) and pay the complete balance in full on time every month. This establishes payment history, ensures that the account reports each month, gives you good credit usage ratios, and gives you the credit mix to maximize your score. IT SHOULD HELP ALOT HOWEVER I AM WONDERING HOW YOU EVEN GOT THE LOAN WITH THAT SCORE MUST BE HUGE DOWN PAYMENT Immediately, it wont make a big difference...but with each passing month you are establishing a good history.... if you do well on all your other accounts, you could be well over 600 within a year.... Do you have other accounts? If you have CC's, paying them below 50% will also help. Loans lower your score (more debt ratio). on time payments will raise your score. so, keep making all payments - not just your auto loan - on time. Try to pay a little more - even just 5.00 over the minimum payments can help your credit score go up. Getting the loan might not raise your score at all. It could, actually, lower it. However, paying on time, will raise your score little by little. I resell credit reports. First, it's going to go down. As you pay off the loan, it will go up. By the end of the loan, it should be higher then when you started. |
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