I have recently came into some money. I just purchased a new vehicle about 4 months ago and i was thinking of paying it off. I do not have any credit so with me paying on it has helped my credit, and i was wondering if i should keep paying on it or pay it off? Which one would be better for boosting my credit score? Any info would be greatly appreciated.
2006-12-05 03:35:47 · 5 answers · asked by colee 1 in Business & Finance ➔ Credit
It would be good to pay it off then you are not paying interest. Interest should only be received not given!
2006-12-05 04:00:16 · answer #1 · answered by Gone fishin' 7 · 0⤊ 0⤋
No , this will not help you.
Your credit profile requires timely payments over an extended period of time (2 years+) to have any lasting impact.
Instead of paying off the vehicle, deposit the money into an interest bearing account and do not spend it. These are considered "reserves" or "assets" which really will strengthen your profile.
Here is some additional info. Hope this helps.
2006-12-05 12:30:18 · answer #2 · answered by Anonymous · 0⤊ 0⤋
Paying off balances on Installment loans is not as beneficial as paying off revolving debt. Making all payments on time on a car loan is actually better than paying it all off at once, as it demonstrates a pattern of paying on time.
You would save on interest by paying the loan early, but it would do very little for your score.
2006-12-05 11:42:25 · answer #3 · answered by RedSoxFan 4 · 0⤊ 0⤋
Unfortunately, it will probably help your credit more by continuing to make payments. You will pay some money in interest payments, but making payments is what really helps boost your credit rating. It is my understanding that making payments on a car loan is next to making mortgage payments in building your credit.
2006-12-05 11:42:23 · answer #4 · answered by Flyby 6 · 0⤊ 0⤋
no. it doesn't matter when its paid off, only that it is paid off.
2006-12-06 23:55:29 · answer #5 · answered by luciousgreeneyedlady 5 · 0⤊ 0⤋