swingline Posted September 8, 2023 Share Posted September 8, 2023 I've been able to pay off my remaining mortgage for some time, but I've let it hang around as I've been doing other things with the money. I'm now thinking of biting the bullet and getting rid of it, but a couple of things have been holding me back. I don't have to have any debt, but I take advantage of opportunities for cheaper debt that I've used to make more than the debt costs me. As a result my credit scores while "good" can't really afford the 30-50 point hit of just paying the mortgage off completely right now. I could trigger lenders closing down cards that I use for rewards, higher insurance rates, etc. and I don't want that. I'm thinking about paying the mortgage down to about $10k and just suck up paying about $500 in interest for the next year, as I pay the minimum monthly to put off the credit score hit until I've rebounded a little and am ready for it. I'm not able to find anyone complaining that they've been penalized by the credit bureaus for paying off most (but not all) of their mortgage with a lump sum. And am wondering if that is because that doesn't happen, or just because I didn't look hard enough? If I do pay it down to $10k, should I expect any impact on my credit score at all? Quote Link to comment Share on other sites More sharing options...
liverichly Posted September 8, 2023 Share Posted September 8, 2023 This might be a better question for the Advanced Credit Topics section since it has to do with actions that impact credit scores, but from my personal experience I haven't seen my scores drop as my mortgage balances decrease. I also haven't noticed it with borrowers I've helped in the past, although I'm seeing their credit reports only at certain points in time rather than monitoring them on a month-to-month basis. swingline 1 Quote Link to comment Share on other sites More sharing options...
swingline Posted September 8, 2023 Author Share Posted September 8, 2023 Thanks for the response. I haven't seen that either with a steady decline over the years. And I haven't seen anyone complaining that a large payment makes an impact. It looks like they only attack people who have paid off their mortgages 100%. Quote Link to comment Share on other sites More sharing options...
hegemony Posted September 28, 2023 Share Posted September 28, 2023 pay it off and let FICO be damned. I have not had an open installment loan for 8 years and scores are in the 800s. MP80, TheVig and liverichly 1 2 Quote Link to comment Share on other sites More sharing options...
swingline Posted October 30, 2023 Author Share Posted October 30, 2023 (edited) Just an update -- I decided to go ahead and pay most of it off, but leaving a small balance to avoid the credit hit. Because the mortgage company is crooked and predatory, they wouldn't report the lower balance to the credit bureaus. After a month, I disputed the wrong mortgage balance, and in retaliation the mortgage company reported the account as closed and I was hit with a 50+ drop on all three credit accounts. Edited October 30, 2023 by swingline Quote Link to comment Share on other sites More sharing options...
A Credit Ed Posted October 31, 2023 Share Posted October 31, 2023 17 hours ago, swingline said: in retaliation the mortgage company reported the account as closed and I was hit with a 50+ drop on all three credit accounts Can you dispute it being closed? That would be fun. swingline 1 Quote Link to comment Share on other sites More sharing options...
swingline Posted October 31, 2023 Author Share Posted October 31, 2023 (edited) 6 hours ago, A Credit Ed said: Can you dispute it being closed? That would be fun. I did! And they responded to the Equifax dispute claiming it was closed with a $0 balance. Now it is correctly reported to my Transunion and Experian with the significantly lower balance, and both of those went up about 20 points. So their incorrect reporting is costing me about 70 points. Edited October 31, 2023 by swingline Quote Link to comment Share on other sites More sharing options...
swimmingwithsharks Posted November 11, 2023 Share Posted November 11, 2023 Now I'm waiting for bated breath to read WHO is this servicer??? Quote Link to comment Share on other sites More sharing options...
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