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Does payoff loan hurt your credit?
Nicholas Hinrichsen - Published: December 1, 2023
You were asking yourself 'does paying off your loan hurt your credit?'
Short answer is no, paying off a loan does not hurt your credit. The longer answer is that it could be a help to keep making consistent payments on time.
A Credit Score is meant to determine your discipline with paying back all debts. Often, lenders look at both the number and types of accounts you have open as well as the history. Imagine two examples:
So while paying off the loan will definitely not hurt your credit, if you're looking to build credit then making payments on time over long periods of time is the best means to achieve your goal.undefined
Haven't explored refinancing yet? Take a look at our exhaustive article about all the auto refinance companies and you will realize, WithClutch.com is the only fully digital platform that lets car owners like you do so from the comfort of their own home. No need to set a foot in a bank or credit union. You can lower your rate or get cash in as little as 20 seconds.
Follow three simple steps to refinance your auto loan, get approved in seconds and save thousands in minutes.
A Credit Score is meant to determine your discipline with paying back all debts. Often, lenders look at both the number and types of accounts you have open as well as the history. Imagine two examples:
- Someone who only has ever received an auto loan and paid it back in 3 months
- Someone who has a credit card, a mortgage, 3 auto loans and has never missed a payment in 25 years?
So while paying off the loan will definitely not hurt your credit, if you're looking to build credit then making payments on time over long periods of time is the best means to achieve your goal.undefined
Haven't explored refinancing yet? Take a look at our exhaustive article about all the auto refinance companies and you will realize, WithClutch.com is the only fully digital platform that lets car owners like you do so from the comfort of their own home. No need to set a foot in a bank or credit union. You can lower your rate or get cash in as little as 20 seconds.
Follow three simple steps to refinance your auto loan, get approved in seconds and save thousands in minutes.
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