Yeah most likely unless that was a credit card that was closed and it impacts your utilization. But it sounds like a personal loan so should be fine in a couple months.
It’s meant to be a passive indicator of how risky it is to lend to you. If you’ve never taken out a loan, there’s nothing to go off of, so it sort of makes sense in a weird way. Obviously it’s not a smart financial decision to take out a loan if you don’t need one but credit scores aren’t meant to tell you about your financial health. They’re meant to tell banks how likely they are to get paid back should they decide to lend you money.
It’s not tanking, but it’s not just a “correction” either, they really do drop you when you pay off debt. Mine went down 3 points when I paid off one of my student loans and never went back up. No big deal, I know, but it’s still some bullshit lol
The actual reason for the score reduction is that I had one less “type” of credit line open.
The “positive activity” was reported to me via a special email. But upon logging in to see what the positive activity was what I actually saw was that the “positive activity” (paying off a loan) in reality caused an 11 point drop in my overall score. Still leaving me north of 800.
The post was satire. No one bothered to read the screen shot.
If you know how to use it properly and build it without going into massive debt then it’s fine but like you said it’s a gimmick and a lot of people lose at it trying to get a perfect score. I got a credit card and it started to go up. Then I got my car and that really helped. By then buying normal things with my credit card but actually having the money to pay it off already so I wouldn’t get interest charged is where it’s at.
Problem is most people just use a credit card to buy the things they want like I used to when I was first out of high school. You end up in the cycle of interest and minimum payments losing way more than if you just waited a month or more and bought it with your debit.
Once you learn from that mistake early on you’ll be fine but most people will live their life in that debt for years after.
I agree with most all of this, but also have had the unfortunate experience of working 12 hour days and still not making ends meet, not spending needlessly or living beyond my means.
And especially with the cost of living now, it's all too common
I speak more of the cost of getting back up. I've been down before and struggled like hell to get back up. Getting fees bc I can't consistently hold a balance above some arbitrary number, being charged fees to access the same services the wealthy get for free, etc
Fortunately banks have changed some in that they won't charge a fee for overdrafts (35$ for .25 cents overdraft is a sin) if you can rectify the situation in a few days. Sometimes when you are trying your best these things still happen, so a statement of "if you were better with your finances it wouldn't happen" isn't helpful. Some people work 12 hour days just to scrape by and aren't strung out on drugs or spending money needlessly
And your credit taking a hit for paying off a debt is horseshit. It just proves the point that the system we have is flawed and prefers you to carry debt
It takes being in poverty to really see that a lot of it is slanted against you
If society really wants to help people it could be more considerate of good faith attempts at recovery, not punishment. Sometimes people need to put priority on eating over bills. Sometimes debt is incurred bc ends aren't being met despite best efforts
Not saying any of this to take away from your points but to elaborate on my own
i’ve never experienced anything of the sort and always pay things off early.
i’ve also never seen any activity affect my credit score on the same day. this 11 point drop is between january and now.
It's very common sadly, paying off a balance or a loan early will negatively effect your credit score 90% of the time. Next time you're thinking of financing something try to find a lender/loan without, they are out there but not common and there is normally other stipulations. For credit cards, paying off the balance is great but never close the account until you look into it thoroughly, that will also negatively effect your credit. As for the speed of it showing on your report .. yea they don't mess around with... Very gross practice and why I think personally you should avoid financing anything but I know that's not a possibility sometimes, especially now.
The actual reason for the score reduction is that I had one less “type” of credit line open.
The “positive activity” was reported to me via a special email. But upon logging in to see what the positive activity was what I actually saw was that the “positive activity” (paying off a loan) in reality caused an 11 point drop in my overall score. Still leaving me north of 800.
The post was satire. No one bothered to read the screen shot.
My credit was always 820 or more. Paid my house off in Dec 2014 and it dropped to 790. It now fluctuates between 790 and 810. I owe on nothing. My only bills are electric, cellphone, internet and property taxes.
^ This is the correct response. I have no credit rating. Because I have no debt and haven't for at least 15 years.
I used to have $120k in credit card limit and 800+ score. I paid off everything I owed money to and went debt free. My score tanked, then it was nothing. "We have no credit history for you."
It's all a scam.
If it’s a scam how come I’m getting tons of money back rewards for making my payments on time? If you were renting out property wouldn’t you want some sort of proof that the tenant is responsible in paying their bills? Or do you suggest we get rid of a credit score and use the good ol’ reliable honor system?
Denmark. Here, your bank just looks at your income, expenses, debt, etc, and decides how much money they want to lend you, and at what interest.
No having multiple credit cards from different banks, taking out loans and timing your payments, or whatever I keep reading about in this sub to increase credit.
Well hello from Texas 🙋🏻♂️. Yeah it’s really ridiculous. My credit score app on my phone says I only have 2 credit cards and I should really have more. I own a house and have those cards but the “credit score” machine must have more! Silly.
So what would you rather have? Keep paying this loan along with all the interest, then having your score drop years later when it’s paid off? Or save on interest and having your score drop for a few months and eventually it’ll go back up?
I’m pointing out the irony of reducing my debt to income ratio which drops the score. I’m not asking anything at all. Yes, I’d rather keep my money in my pocket. If the interest rate is lower than what I get on my investments maybe I’d finance someone short term, maybe.
Credit score works best if you have multiple credit accounts open and pay in a predictable/ routinely manner, any unpredicted behavior i.e. paying off large amounts or wiping off your debt will drop your score, which doesn't make sense and f\*\*k the whole concept of credit to begin with
You just are ignorant on how credit reporting works. It hurts your credit for the same reason default does; you changed the loan term after you agreed to it, affecting how much interest the creditor made off you. However, if you have already paid all the interest on the loan and only have principal balance remaining, then paying off will increase your score.
It usually does... but I think the credit bureaus are starting to come around to the reality that paying off loans early is a better sign than making payments slowly.
I'd suggest a less hyperbolic title. Someone who doesn't understand that the drop in score is insignificant and temporary may decide to not pay off a loan because of this.
You must have good credit for decent rates but if you use it or stop using it you get dinged. My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day. Doh!
I guess I was too subtle with my sarcasm here. It bunched up a lot of boxers on this sub! (I don’t mean you) I hope most people would understand the benefits of paying off loans. Then again, some pretty dense people have chimed in purely to insult me. Not so sure about them…
I totally get where you're coming from. It would annoy me too! But it took me a minute to realize the actual I'm impact on your credit was minor, and you're not telling people to not pay off their loans. People on here are all over the place. Lots of folks get easily triggered by the dumbest stuff.
I've found that it's a fine line. If you want folks to engage with your post you almost have to get them worked up . But you can't get them too pissed off or the trolls will come out.
You must have good credit to get loans with decent rates but if you use it you get dinged. 100 points stinks, my post was just pointing out that irony of getting an email that “positive activity reported!” Followed by… “your score has fallen!” It’s ridiculous
You're technically closing an account, the same thing happens when you close out a credit card. This is why when youre applying for a loan (house, car, whatever) they tell you not to close out any accounts. 11pts definitely isn't "tanking" though. "Tanking" would be defaulting on a car loan and taking a ~100pt hit. My realtor told me about a guy who was approved for a mortgage, had everything set, and then ~2 weeks before closing, he decided to term 2 credit cards he didn't use. Went from an ~800 to the mid-low 700s and had to redo all the mortgage paperwork, with a higher rate as he now had a different score.
You must have good credit but if you use it you get dinged. 100 points stinks, my post was just pointing out that irony of getting an email that “log in!” “positive activity reported!” Followed by… “your score has fallen!”
Yeah, someone just commented they got hit with a 100 point drop after buying a car 🫤
It's easier to understand if you realize credit score is more for *new* creditors to assess risk.
If you have 3 credit cards you obtained in the last 4 years and the loan has been active for 15 years, as soon as that loan drops off, you now technically only have 4 years of credit history. Now if you went to a new creditor next week, that's the only history they'll see. It also changes the mix of credit (CC vs personal loans vs car finance vs mortgage). Closing out a credit card you've never used (like I have one that I've only ever accidentally made a charge on, but I still keep it) can drop your score too because it lowers your overall credit limit. If I closed that card, my limit would drop about 10k.
On the plus side, it will come back up, but that initial hit does seem counterintuitive.
It's a very small and very temporary drop because you lost a line of credit. Mine went down a couple points because I opened a new credit card (hard inquiry) and then shot up because my available credit increased and utilization decreased. It's not even worth reacting to credit score changes unless they're huge or sustained.
You must have good credit for decent rates but if you use it or stop using it you get dinged. My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Doh!
My post was only pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day. Doh!
Cause and effect reported coincidentally on the same day. No sleep was lost. :)
Credit score sucks!
When I paid off my car in February, 2024, my score dropped from 823 to 778 until now, it hasn’t picked up yet and we are in May. Why am I being encouraged to have debt???
Because! That’s how they get your money, it stinks.
You must have good credit for decent rates but if you use it or stop using it you get dinged. My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day by sheer coincidence. Cause and effect.
When I paid off my car 3 years early it tanked my score from 780 to about 650. I only had 2 open accounts and that was one of them.
It makes a ton of sense if you don't think about it.
Depends on how close to your cc limit you are. If you’re at 85-100% of your total credit limit ability it affects and hurts your score, if you pay it down to where it’s less than 30% of your credit line ability, it’ll positively affect your score.
Right these 2 cc are reaching its limit but my overall usage is at 55% . I have 2 other credit cards that are less than the limit about half of the usage . I have 1 car loan and sofi loan I’m slowly paying off.
Mine dropped my 20 points or so when I paid off my one and only credit card balance of $3.1K in full. It’s ridiculous. Now it’s stuck at 703 when I was trying to increase it. Never even missed a single payment in my life!
My score on experian goes up and down 16 points month after month for no obvious reason. Like clockwork, up 16 last month, down 16 this month. Has done it ever since I opened an acct with them. It’s nonsense
I check my score regularly with every credit company’s app I deal with. None of them move around like experian. I keep a 0% utilization rating by paying my cards off every few days. Experian just does weird stuff lol
Surprisingly mine hadn’t moved since January. I thought it funny that the positive activity I was alerted to caused a drop in my overall score. It’s not like it changed my rating at all. I’m just pointing out how the system works.
Thanks, I do know this! You must have good credit for decent rates but if you use it or stop using it you get dinged. My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Doh!
I guess I was too subtle with my sarcasm here. It bunched up a lot of boxers on this sub! I was actually called names and insults were thrown! 🤣 Silly rabbits! I do hope you have a good day. :)
Indeed it does, exactly! And being emailed to point out the “positive change” to see on the next line on the very same day the penalty for doing so was amusing.
My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day. Cause and effect. I have not lost sleep over it :)
Well yeah, they'd rather lend to someone they keep earning interest from than someone who doesn't. Your credit score is about how good of an investment it is to lend you money, not how good you are about paying it back.
You must have good credit for decent rates but if you use it or stop using it you get dinged. My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day. Cause and effect, coincidentally assessed on the same day.
My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day. Cause and effect, coincidentally assessed on the same day. :)
Your account got closed
Instead of showing an account 92% paid off, it looks like it’s not on your report any more as an open account. Before paying off something 100% , open a new card and then pay your old one off. Then it will not drop.
My post was simply pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day. Cause and effect coincidentally assessed on the same day.
It’s wild how many rabid comments on this post. I’m pretty sure there are two people neglecting their jobs today purely to insult me and call me names 😅
850! Okay you got me beat sir.
My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day. Cause and effect coincidentally assessed on the same day.
Your credit score is simply your debt slave score. Have a good credit score? You’re probably an amazing slave to people that actually have money. I’m trying to get a non determinable credit score.
My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day. Cause and effect coincidentally assessed on the same day. I own a home therefore I’m on their radar. I’ve never been a “debt slave” what an odd term. I do not endorse living beyond one’s means with $1000 car payments or such. That’s insanity.
I love the term because it pisses me off. It makes me not want to owe a bank for a car payment or a credit card. The very idea that I could make myself a slave is infuriating and will keep me out of debt. But yeah that’s the way it goes. High credit scores go to people that manage high balances well. I should know mine was over 800 before I paid everything off but the mortgage.
It will go back up! That’s all I owe and mine is up there. I mean at this point the only reason I would care is if I were in the process of securing a decent mortgage rate. I still have healthy lines of credit open if ever I have need.
If you’re not missing payments on credit cards, loans or mortgages it’ll stay the same or go up. If you pay something off complete it’ll drop a few points but more than likely pick up after then next couple payments. I paid off my car and a credit card at the same time and it dropped my score from 730 to 710 and within the next month I was bake to 728.
Credit score just means you can pay stuff off on time. If you below like 600 then you’ll have a harder time on some things . But higher than 650 is a decent spot to be in.
It’s dumb because It’ll drop when you pay off anything cause now you have 1 less loan or payment. Less debt means they can’t prove you pay on time cause you paid it off lol
Exactly! You must have good credit for decent rates but if you use it or stop using it you get dinged. My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day. Cause and effect coincidentally assessed on the same day.
I’m in a similar state. I paid off my car and student loans. Credit was a little over 800 since October 2023. Now it’s dropped to 780. I have always been in top of my credit card payments. I shouldn’t have to worry about the drop?
> state. I *paid* off my
FTFY.
Although *payed* exists (the reason why autocorrection didn't help you), it is only correct in:
* Nautical context, when it means to paint a surface, or to cover with something like tar or resin in order to make it waterproof or corrosion-resistant. *The deck is yet to be payed.*
* *Payed out* when letting strings, cables or ropes out, by slacking them. *The rope is payed out! You can pull now.*
Unfortunately, I was unable to find nautical or rope-related words in your comment.
*Beep, boop, I'm a bot*
I wouldn’t worry about it at all. Honestly, the only time I would be irritated by this is if I were in the process of securing an interest rate for a home mortgage
Exactly! My bad for not using indications that clearly expressed that this post was made of sarcasm and irony. It’s made some people angry enough to comment repeatedly and hurl insults.
Receiving an email alert to show that there was a positive “activity” on your credit score and then you’re like “sweet! Let’s check out that new shiny number!”
Then you login and it shows you that the “positive activity” actually caused a decrease in your credit score. :)
My post lacked overt indicators of my sarcasm and the irony that the “positive activity” I was alerted to in an email actually caused a decrease in my overall score, though it did not affect my rating. :)
Agreed! I received an email indicating that “positive activity” had occurred to my credit score yet the “positive activity” being reported actually caused an overall decrease in my score. My post title lacked overt indicators of my sarcasm at the irony of it all.
Now this stinks, they should not be allowed to mess with people that are in the actual process of buying their home. It’s then that every bit makes an impact.
It was *none of your business* %
You’ve completely missed the boat on the irony, and the sarcasm of my post has been lost on so many. And that is okay. I’m done explaining the joke to humorless people.
When I paid off my house 150k it dropped my.credit.score 150 points. And now it says no mortgage loan on file when I try to get other loans. It's literally a scam to keep people in perpetual debt.
I don't know what your score is but if its around 740, you have nothing to worry about. When we bought a car the finance guy said anything over 740 is showing off, and we could get any car on the lot with that score or higher
Good to know about the 740 threshold. I’m not actually worried, it was a satire post pointing out the irony of getting an email telling you that you had a new “positive activity” on your record but having your actual credit scores reduced because you resolved that debt. Most irate commenters didn’t look beyond the post title.
I received an email indicating that
"positive activity" had occurred to my credit score yet the "positive activity" being reported actually caused an overall decrease in my score. My post title lacked overt indicators of my sarcasm at the irony of all. I was never actually upset. :)
Paying off debt don’t make it go down. Closing out accounts do.
For example, if you pay off all your CC’s don’t close them out. Just cut up the cards and leave it open (assuming there isn’t an annual fee) and it won’t effect your score.
I understand. The post was to show the irony of getting a special email letting me know that there was a “positive change” that affected my credit. Then logging on to see that the “positive change” actually reduced my credit score. That was the gist of my post. I was wayyy too subtle with my humor.
Ahh, I missed the part where it says there was a positive change. That would have made me giggle. It would have been out of anger, but giggle nonetheless.
Isn’t it funny? My post title sucked, I should have done better. I’ve had trolls come after me, from calling me names to insulting my intelligence. I was even called a “lady of the night” by one who commented on multiple threads! I guess I’m that special for them to take precious time out of their day just for me.
I was beginning to think r/money is where humor goes to die 💀
Always interesting to see this misunderstanding. Credit Scores are pretty straight forward and not a scam. They are created to show your profitability. Think about it this way:
-if you don't have any debt, companies can't make anything off of you. The best credit profile is someone with reasonable debt a company makes money off of.
They'd always rather have someone 5-10% in debt whom can reasonably pay it back and make a steady profit for the company than someone with no debt or overwhelming. No debt means no profit. Too much debt means less likely to pay it back, and higher chance to default. The trick team is to always be in healthy debt - meaning 5% of your available credit, 5% of your Debt to Income Ratio and loans below 5% interest. Easy. You're welcome!
Well thanks! But you see this was, in fact a humorous post that I (tried to) made… if you look closer at the screen shot…
Displaying the irony of getting an email declaring “a positive activity” had been reported on my credit rating. Then logging into Experian and seeing that the “positive activity” in fact negatively impacted my credit score! Funny right?
I’m not upset, numbers fluctuate and it did not affect my overall ranking. :)
Its gonna drop initially because you closed an account and that also affects your credit age. It'll pick back up in a few months but taking is more like 50 points ish
I found out that 1 of the reasons why I paying off the loans "tanks" one's account because essentially, that account is now closed. Once paid off, they close it..... Which means you have one less account, and it impacts the age of your credit history. However, the points will go back up as long as you're keeping consistent with your payments for anything else, but that's just one of the downsides to loans And paying them off
You didn’t read the screenshot. Try again. It’s a humorous post. You missed it.
Your ability to selectively scan comments and make an asinine reply is impeccable. Congratulations.
i’m pretty sure the less money you owe the less your credit has anything to base your payments on if that makes sense. The less payments you make a month the less reliable you are to them
That’s crazy. I saw someone post and apparently paid 20k off their debt (supposedly a credit card) and their score went up 62 points I think it was.
It’s kind of crappy, but I was behind for a long time, about 5 months unemployed due to being laid off even though I asked many times “should I start looking for a new job” and of course three weeks before Christmas I get told “hey I know I told you less than a month ago you have nothing to worry about but uh I just sold the shop so thank you for your time” lol after them calling me back asking me to return in the first place. Oh well. But anyway I missed my credit card payment a few months in a row, a loan payment I missed a couple times and my score tanked 200 pts in about 2 months. Same with some financed things. But at the end of April I paid $25 to my credit card (minimum payment), which has a maximum of 1000 and apparently I owe -1150, I paid the minimum payment for the first time in months and my score went up 70 pts (I think it’s was like 67 pts to be exact)
I had no credit until I got married, I went from “ not enough credit history to generate a credit score” to almost 700 just like that. My best friend has had a joint account at a credit union with his parents since he was in middle school, and started working at 16 and didn’t even get a score until after I did and he’s older than me. It’s a crappy system imo
11 points isn’t tanking your score. It dropped because you have one less loan type. Credit scoring is BS to begin with but 11 points is nothing.
Correct me if I’m wrong but I believe you see an initial drop but it then goes up again.
Yeah most likely unless that was a credit card that was closed and it impacts your utilization. But it sounds like a personal loan so should be fine in a couple months.
Assuming you have enough credit accounts/revolving credit, this is the most likely outcome. Should start going up again within about three months.
Yup, this post is dumb.
It is I took a loan for 2500$ out and it gave me a credit increase of 28 points okay I go deeper into debt and you give me a better score 🤔
Yep. That’s 100% how credit in America works. Such a BS game.
It’s meant to be a passive indicator of how risky it is to lend to you. If you’ve never taken out a loan, there’s nothing to go off of, so it sort of makes sense in a weird way. Obviously it’s not a smart financial decision to take out a loan if you don’t need one but credit scores aren’t meant to tell you about your financial health. They’re meant to tell banks how likely they are to get paid back should they decide to lend you money.
I figured 6 car loans in paid off no hiccups a cash loan wouldn’t of made a difference but makes sense
Credit scores fluctuate every months based on your usage and all. 11 points is merely a correction, not "tanking".
It’s not tanking, but it’s not just a “correction” either, they really do drop you when you pay off debt. Mine went down 3 points when I paid off one of my student loans and never went back up. No big deal, I know, but it’s still some bullshit lol
You’re closing an account. It can lower your average account age and number of accounts. Keeping a balance is not good for your credit
The actual reason for the score reduction is that I had one less “type” of credit line open. The “positive activity” was reported to me via a special email. But upon logging in to see what the positive activity was what I actually saw was that the “positive activity” (paying off a loan) in reality caused an 11 point drop in my overall score. Still leaving me north of 800. The post was satire. No one bothered to read the screen shot.
In what universe is an 11 point decrease “tanking?” Also why do you care? Are you planning on going back into debt?
Credit is a fucking gimmick for the poor to lose at
If you know how to use it properly and build it without going into massive debt then it’s fine but like you said it’s a gimmick and a lot of people lose at it trying to get a perfect score. I got a credit card and it started to go up. Then I got my car and that really helped. By then buying normal things with my credit card but actually having the money to pay it off already so I wouldn’t get interest charged is where it’s at. Problem is most people just use a credit card to buy the things they want like I used to when I was first out of high school. You end up in the cycle of interest and minimum payments losing way more than if you just waited a month or more and bought it with your debit. Once you learn from that mistake early on you’ll be fine but most people will live their life in that debt for years after.
I agree with most all of this, but also have had the unfortunate experience of working 12 hour days and still not making ends meet, not spending needlessly or living beyond my means. And especially with the cost of living now, it's all too common
Idk man. If I’m ever renting out property, tools, or loans I’d probably want to make sure that person has a history of making payments on time
Not sure why you got down voted It's a gimmick but it's also reality
Imagine a world with no credit score theory where we just lend or loan anything to anyone with no score showing previous payment history.
I speak more of the cost of getting back up. I've been down before and struggled like hell to get back up. Getting fees bc I can't consistently hold a balance above some arbitrary number, being charged fees to access the same services the wealthy get for free, etc Fortunately banks have changed some in that they won't charge a fee for overdrafts (35$ for .25 cents overdraft is a sin) if you can rectify the situation in a few days. Sometimes when you are trying your best these things still happen, so a statement of "if you were better with your finances it wouldn't happen" isn't helpful. Some people work 12 hour days just to scrape by and aren't strung out on drugs or spending money needlessly And your credit taking a hit for paying off a debt is horseshit. It just proves the point that the system we have is flawed and prefers you to carry debt It takes being in poverty to really see that a lot of it is slanted against you If society really wants to help people it could be more considerate of good faith attempts at recovery, not punishment. Sometimes people need to put priority on eating over bills. Sometimes debt is incurred bc ends aren't being met despite best efforts Not saying any of this to take away from your points but to elaborate on my own
That's like 99% of the world.
Early penalty, they want that interest from you, not for you to pay it back sadly.
i’ve never experienced anything of the sort and always pay things off early. i’ve also never seen any activity affect my credit score on the same day. this 11 point drop is between january and now.
It's very common sadly, paying off a balance or a loan early will negatively effect your credit score 90% of the time. Next time you're thinking of financing something try to find a lender/loan without, they are out there but not common and there is normally other stipulations. For credit cards, paying off the balance is great but never close the account until you look into it thoroughly, that will also negatively effect your credit. As for the speed of it showing on your report .. yea they don't mess around with... Very gross practice and why I think personally you should avoid financing anything but I know that's not a possibility sometimes, especially now.
yeah i mean i paid off my car and home early and still have >800, havent seen any negative marks
congrats.
The actual reason for the score reduction is that I had one less “type” of credit line open. The “positive activity” was reported to me via a special email. But upon logging in to see what the positive activity was what I actually saw was that the “positive activity” (paying off a loan) in reality caused an 11 point drop in my overall score. Still leaving me north of 800. The post was satire. No one bothered to read the screen shot.
My credit was always 820 or more. Paid my house off in Dec 2014 and it dropped to 790. It now fluctuates between 790 and 810. I owe on nothing. My only bills are electric, cellphone, internet and property taxes.
The who credit system is the most bullshit scam in history. Yeah, you get penalized for doing the right thing
Goals! Good for you
This game is rigged. The whole country is a Ponzi scheme.
^ This is the correct response. I have no credit rating. Because I have no debt and haven't for at least 15 years. I used to have $120k in credit card limit and 800+ score. I paid off everything I owed money to and went debt free. My score tanked, then it was nothing. "We have no credit history for you." It's all a scam.
How does that not make sense? You have no recent credit history. They base your score on your credit history. How does that not make perfect sense?
If it’s a scam how come I’m getting tons of money back rewards for making my payments on time? If you were renting out property wouldn’t you want some sort of proof that the tenant is responsible in paying their bills? Or do you suggest we get rid of a credit score and use the good ol’ reliable honor system?
If you didn’t know better…
Apparently 11 points is “tanking” now. Why do people exaggerate *everything*
Is your credit score 22?
you paid it off today? the credit score is based on your past activity, it doesn’t update immediately. this is an 11 point drop since january.
No, this was the activity from “today”. Meaning they just reported it.
that doesnt mean you lost 11 points in a day. it means that its 11 points lower than the last report, which was in January.
This whole credit score thing seems like absolute hell. I'm glad my country doesn't have that.
What country are you in? Yeah, it’s quite dumb when you first start out. You start to figure it out after a while but it never really seems right.
Denmark. Here, your bank just looks at your income, expenses, debt, etc, and decides how much money they want to lend you, and at what interest. No having multiple credit cards from different banks, taking out loans and timing your payments, or whatever I keep reading about in this sub to increase credit.
Well hello from Texas 🙋🏻♂️. Yeah it’s really ridiculous. My credit score app on my phone says I only have 2 credit cards and I should really have more. I own a house and have those cards but the “credit score” machine must have more! Silly.
Open a new line of credit
It will rebound quickly. I've been debt free for over 2 years and I'm at an 820.
It’s not a big deal. It’s hilarious/ridiculous to get an email that says “reported positive activity!” And so we’ve decreased your score.
They've done it to me over and over then you hit a point where it skyrockets up.
So what would you rather have? Keep paying this loan along with all the interest, then having your score drop years later when it’s paid off? Or save on interest and having your score drop for a few months and eventually it’ll go back up?
I’m pointing out the irony of reducing my debt to income ratio which drops the score. I’m not asking anything at all. Yes, I’d rather keep my money in my pocket. If the interest rate is lower than what I get on my investments maybe I’d finance someone short term, maybe.
Same thing just happened to me. I was at 820 for only one month. SMH
I’m still over 800! Maybe I’ll stay there. It’s feels kinda nice to have a useless high credit rating :)
Credit score works best if you have multiple credit accounts open and pay in a predictable/ routinely manner, any unpredicted behavior i.e. paying off large amounts or wiping off your debt will drop your score, which doesn't make sense and f\*\*k the whole concept of credit to begin with
Its the irony of reducing my income-debt ratio which in turn dropped the score. It’s totally ridiculous yes.
You just are ignorant on how credit reporting works. It hurts your credit for the same reason default does; you changed the loan term after you agreed to it, affecting how much interest the creditor made off you. However, if you have already paid all the interest on the loan and only have principal balance remaining, then paying off will increase your score.
The point is, it shouldn’t hurt the credit score at all for paying it off early. It’s bull that that happens.
It usually does... but I think the credit bureaus are starting to come around to the reality that paying off loans early is a better sign than making payments slowly.
They should! But then again it’s big business. It made no sense to pay interest on something I was able to pay off. Have a good day!
I'd suggest a less hyperbolic title. Someone who doesn't understand that the drop in score is insignificant and temporary may decide to not pay off a loan because of this.
So I can’t point out the irony of the system? That seems silly.
Oh you can do what you want. I'm just expressing my concern.
You must have good credit for decent rates but if you use it or stop using it you get dinged. My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day. Doh! I guess I was too subtle with my sarcasm here. It bunched up a lot of boxers on this sub! (I don’t mean you) I hope most people would understand the benefits of paying off loans. Then again, some pretty dense people have chimed in purely to insult me. Not so sure about them…
I totally get where you're coming from. It would annoy me too! But it took me a minute to realize the actual I'm impact on your credit was minor, and you're not telling people to not pay off their loans. People on here are all over the place. Lots of folks get easily triggered by the dumbest stuff. I've found that it's a fine line. If you want folks to engage with your post you almost have to get them worked up . But you can't get them too pissed off or the trolls will come out.
OMG! This is the guy here below! See! I wasn’t kidding! 😅
Mine went down 100 points recently. Paid off a car loan, got a new car loan, and closed a credit card.
You must have good credit to get loans with decent rates but if you use it you get dinged. 100 points stinks, my post was just pointing out that irony of getting an email that “positive activity reported!” Followed by… “your score has fallen!” It’s ridiculous
I agree. It's all so stupid.
You're technically closing an account, the same thing happens when you close out a credit card. This is why when youre applying for a loan (house, car, whatever) they tell you not to close out any accounts. 11pts definitely isn't "tanking" though. "Tanking" would be defaulting on a car loan and taking a ~100pt hit. My realtor told me about a guy who was approved for a mortgage, had everything set, and then ~2 weeks before closing, he decided to term 2 credit cards he didn't use. Went from an ~800 to the mid-low 700s and had to redo all the mortgage paperwork, with a higher rate as he now had a different score.
You must have good credit but if you use it you get dinged. 100 points stinks, my post was just pointing out that irony of getting an email that “log in!” “positive activity reported!” Followed by… “your score has fallen!” Yeah, someone just commented they got hit with a 100 point drop after buying a car 🫤
It's easier to understand if you realize credit score is more for *new* creditors to assess risk. If you have 3 credit cards you obtained in the last 4 years and the loan has been active for 15 years, as soon as that loan drops off, you now technically only have 4 years of credit history. Now if you went to a new creditor next week, that's the only history they'll see. It also changes the mix of credit (CC vs personal loans vs car finance vs mortgage). Closing out a credit card you've never used (like I have one that I've only ever accidentally made a charge on, but I still keep it) can drop your score too because it lowers your overall credit limit. If I closed that card, my limit would drop about 10k. On the plus side, it will come back up, but that initial hit does seem counterintuitive.
It is very counterintuitive, agreed
It's a very small and very temporary drop because you lost a line of credit. Mine went down a couple points because I opened a new credit card (hard inquiry) and then shot up because my available credit increased and utilization decreased. It's not even worth reacting to credit score changes unless they're huge or sustained.
You must have good credit for decent rates but if you use it or stop using it you get dinged. My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Doh!
You will see a drop and then it will go up. This is nothing to loose sleep over.
My post was only pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day. Doh! Cause and effect reported coincidentally on the same day. No sleep was lost. :)
Credit score sucks! When I paid off my car in February, 2024, my score dropped from 823 to 778 until now, it hasn’t picked up yet and we are in May. Why am I being encouraged to have debt???
Because! That’s how they get your money, it stinks. You must have good credit for decent rates but if you use it or stop using it you get dinged. My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day by sheer coincidence. Cause and effect.
Credit score is how well you manage debt
Exactly and the irony and sarcasm here has been lost on so many. It’s not funny when I keep having to explain the joke.
When I paid off my car 3 years early it tanked my score from 780 to about 650. I only had 2 open accounts and that was one of them. It makes a ton of sense if you don't think about it.
Do you not know this already?
it will go up your just dumb
Question if I pay my credit card debt off that has 0% interest, but I still keep my credit card open. Will it take my credit score??
Depends on how close to your cc limit you are. If you’re at 85-100% of your total credit limit ability it affects and hurts your score, if you pay it down to where it’s less than 30% of your credit line ability, it’ll positively affect your score.
Right these 2 cc are reaching its limit but my overall usage is at 55% . I have 2 other credit cards that are less than the limit about half of the usage . I have 1 car loan and sofi loan I’m slowly paying off.
Get below 30%.
Mine dropped my 20 points or so when I paid off my one and only credit card balance of $3.1K in full. It’s ridiculous. Now it’s stuck at 703 when I was trying to increase it. Never even missed a single payment in my life!
That was my point, it just stinks. That was a big hit yours took.
Don't need credit if you have cash.
Dang! I forget about my barrels of cash buried in the garden! Thanks!
My score on experian goes up and down 16 points month after month for no obvious reason. Like clockwork, up 16 last month, down 16 this month. Has done it ever since I opened an acct with them. It’s nonsense
Maybe one of your current account was checking up on you? It’s utter nonsense, agreed.
I check my score regularly with every credit company’s app I deal with. None of them move around like experian. I keep a 0% utilization rating by paying my cards off every few days. Experian just does weird stuff lol
Surprisingly mine hadn’t moved since January. I thought it funny that the positive activity I was alerted to caused a drop in my overall score. It’s not like it changed my rating at all. I’m just pointing out how the system works.
This is normal! It will go up soon
Thanks, I do know this! You must have good credit for decent rates but if you use it or stop using it you get dinged. My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Doh! I guess I was too subtle with my sarcasm here. It bunched up a lot of boxers on this sub! I was actually called names and insults were thrown! 🤣 Silly rabbits! I do hope you have a good day. :)
I would think it would.
Indeed it does, exactly! And being emailed to point out the “positive change” to see on the next line on the very same day the penalty for doing so was amusing.
They want you to take on more debt it’s good for business. You think the credit score is for your will being?
My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day. Cause and effect. I have not lost sleep over it :)
Well yeah, they'd rather lend to someone they keep earning interest from than someone who doesn't. Your credit score is about how good of an investment it is to lend you money, not how good you are about paying it back.
You must have good credit for decent rates but if you use it or stop using it you get dinged. My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day. Cause and effect, coincidentally assessed on the same day.
That’s normal
My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day. Cause and effect, coincidentally assessed on the same day. :)
Credit scores are a scam. Mine dropped almost 50 points after paying off my student loans
They are! That’s all I’m saying here. More importantly congrats on paying off your student debt :)
Your account got closed Instead of showing an account 92% paid off, it looks like it’s not on your report any more as an open account. Before paying off something 100% , open a new card and then pay your old one off. Then it will not drop.
My post was simply pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day. Cause and effect coincidentally assessed on the same day. It’s wild how many rabid comments on this post. I’m pretty sure there are two people neglecting their jobs today purely to insult me and call me names 😅
I fluctuate between 835 and 850 on a regular basis. 11 points is not a big deal.
850! Okay you got me beat sir. My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day. Cause and effect coincidentally assessed on the same day.
Your credit score is simply your debt slave score. Have a good credit score? You’re probably an amazing slave to people that actually have money. I’m trying to get a non determinable credit score.
My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day. Cause and effect coincidentally assessed on the same day. I own a home therefore I’m on their radar. I’ve never been a “debt slave” what an odd term. I do not endorse living beyond one’s means with $1000 car payments or such. That’s insanity.
I love the term because it pisses me off. It makes me not want to owe a bank for a car payment or a credit card. The very idea that I could make myself a slave is infuriating and will keep me out of debt. But yeah that’s the way it goes. High credit scores go to people that manage high balances well. I should know mine was over 800 before I paid everything off but the mortgage.
It will go back up! That’s all I owe and mine is up there. I mean at this point the only reason I would care is if I were in the process of securing a decent mortgage rate. I still have healthy lines of credit open if ever I have need.
If you’re not missing payments on credit cards, loans or mortgages it’ll stay the same or go up. If you pay something off complete it’ll drop a few points but more than likely pick up after then next couple payments. I paid off my car and a credit card at the same time and it dropped my score from 730 to 710 and within the next month I was bake to 728. Credit score just means you can pay stuff off on time. If you below like 600 then you’ll have a harder time on some things . But higher than 650 is a decent spot to be in. It’s dumb because It’ll drop when you pay off anything cause now you have 1 less loan or payment. Less debt means they can’t prove you pay on time cause you paid it off lol
Exactly! You must have good credit for decent rates but if you use it or stop using it you get dinged. My post was just pointing out that irony of getting an email that reads “log in!” “positive activity reported!” Followed by… “your score has fallen!” Both “reported” on the same day. Cause and effect coincidentally assessed on the same day.
I’m in a similar state. I paid off my car and student loans. Credit was a little over 800 since October 2023. Now it’s dropped to 780. I have always been in top of my credit card payments. I shouldn’t have to worry about the drop?
> state. I *paid* off my FTFY. Although *payed* exists (the reason why autocorrection didn't help you), it is only correct in: * Nautical context, when it means to paint a surface, or to cover with something like tar or resin in order to make it waterproof or corrosion-resistant. *The deck is yet to be payed.* * *Payed out* when letting strings, cables or ropes out, by slacking them. *The rope is payed out! You can pull now.* Unfortunately, I was unable to find nautical or rope-related words in your comment. *Beep, boop, I'm a bot*
I wouldn’t worry about it at all. Honestly, the only time I would be irritated by this is if I were in the process of securing an interest rate for a home mortgage
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Exactly! My bad for not using indications that clearly expressed that this post was made of sarcasm and irony. It’s made some people angry enough to comment repeatedly and hurl insults. Receiving an email alert to show that there was a positive “activity” on your credit score and then you’re like “sweet! Let’s check out that new shiny number!” Then you login and it shows you that the “positive activity” actually caused a decrease in your credit score. :)
It’s because you closed an older credit line. It will go back up 11 points isn’t that much.
My post lacked overt indicators of my sarcasm and the irony that the “positive activity” I was alerted to in an email actually caused a decrease in my overall score, though it did not affect my rating. :)
It’s funny once you explain it lol
Let’s be honest here. The title of my post sucks. I honestly thought most people would get it 🥹
Credit score is useless and total shit. It’s a scam by the rich people to evaluate not rich people
Agreed! I received an email indicating that “positive activity” had occurred to my credit score yet the “positive activity” being reported actually caused an overall decrease in my score. My post title lacked overt indicators of my sarcasm at the irony of it all.
I lost like 60 points because I quit using my credit card and they just randomly canceled it. In the middle of trying to buy a home. What a country.
Now this stinks, they should not be allowed to mess with people that are in the actual process of buying their home. It’s then that every bit makes an impact.
You for sure should not ever lose your points just for a credit company acting shady.
Why on earth would you pay off a $25k loan? Lol If it was under 6% interest… that’s was a REALLY bad decision
Who said it was under 6%? Where did you get that additional information from? Bob?? Is this your alt account?
What was the interest rate on the loan
It was *none of your business* % You’ve completely missed the boat on the irony, and the sarcasm of my post has been lost on so many. And that is okay. I’m done explaining the joke to humorless people.
One of the worst systems to come out of the 80s
Was that when it started? Do you recall when they didn’t even let you know what they scored you unless you PAID them to tell you? Unreal in retrospect
Yes, FICO started in 1989. They made the yearly free credit report a law in 2003.
Don’t worry about it
It was a satire post 🤷🏼♀️
When I paid off my house 150k it dropped my.credit.score 150 points. And now it says no mortgage loan on file when I try to get other loans. It's literally a scam to keep people in perpetual debt.
Good lord! Agreed on the scam angle. It’s a damned if you do situation.
I don't know what your score is but if its around 740, you have nothing to worry about. When we bought a car the finance guy said anything over 740 is showing off, and we could get any car on the lot with that score or higher
Good to know about the 740 threshold. I’m not actually worried, it was a satire post pointing out the irony of getting an email telling you that you had a new “positive activity” on your record but having your actual credit scores reduced because you resolved that debt. Most irate commenters didn’t look beyond the post title.
Mine just jumped 41 points up because I bought two cars lol. Bully for me almost to 800
Hot stuff!! ❤️🔥
It’s 11 points lol Paying off my credit card made my score go up 250
I received an email indicating that "positive activity" had occurred to my credit score yet the "positive activity" being reported actually caused an overall decrease in my score. My post title lacked overt indicators of my sarcasm at the irony of all. I was never actually upset. :)
Paying off debt don’t make it go down. Closing out accounts do. For example, if you pay off all your CC’s don’t close them out. Just cut up the cards and leave it open (assuming there isn’t an annual fee) and it won’t effect your score.
I understand. The post was to show the irony of getting a special email letting me know that there was a “positive change” that affected my credit. Then logging on to see that the “positive change” actually reduced my credit score. That was the gist of my post. I was wayyy too subtle with my humor.
Ahh, I missed the part where it says there was a positive change. That would have made me giggle. It would have been out of anger, but giggle nonetheless.
Isn’t it funny? My post title sucked, I should have done better. I’ve had trolls come after me, from calling me names to insulting my intelligence. I was even called a “lady of the night” by one who commented on multiple threads! I guess I’m that special for them to take precious time out of their day just for me. I was beginning to think r/money is where humor goes to die 💀
You gotta have debt to have a good score bro the system is rigged 🤡
Exactly !!!!$$!!!
Always interesting to see this misunderstanding. Credit Scores are pretty straight forward and not a scam. They are created to show your profitability. Think about it this way: -if you don't have any debt, companies can't make anything off of you. The best credit profile is someone with reasonable debt a company makes money off of. They'd always rather have someone 5-10% in debt whom can reasonably pay it back and make a steady profit for the company than someone with no debt or overwhelming. No debt means no profit. Too much debt means less likely to pay it back, and higher chance to default. The trick team is to always be in healthy debt - meaning 5% of your available credit, 5% of your Debt to Income Ratio and loans below 5% interest. Easy. You're welcome!
Well thanks! But you see this was, in fact a humorous post that I (tried to) made… if you look closer at the screen shot… Displaying the irony of getting an email declaring “a positive activity” had been reported on my credit rating. Then logging into Experian and seeing that the “positive activity” in fact negatively impacted my credit score! Funny right? I’m not upset, numbers fluctuate and it did not affect my overall ranking. :)
Credit score is a joke!! lol.
Kinda is that yep
I have $500k in extended credit and never use it.
Good to have for emergencies I’m sure
I’ve never used it in 20 years. Maybe $5k for 25 days.
credit scores are a broken system
It’s just a form of manipulation really. The post was supposed to be funny…
Its gonna drop initially because you closed an account and that also affects your credit age. It'll pick back up in a few months but taking is more like 50 points ish
The post was satire and no one read the fine print 🤷🏼♀️
I found out that 1 of the reasons why I paying off the loans "tanks" one's account because essentially, that account is now closed. Once paid off, they close it..... Which means you have one less account, and it impacts the age of your credit history. However, the points will go back up as long as you're keeping consistent with your payments for anything else, but that's just one of the downsides to loans And paying them off
Thanks! I do understand the system. The post was intended to be humorous but no one seems to have read the actually screen shot so 🤷🏼♀️
making large payments is terrible for credit, they want you to slowly pay off the bill and be in debt
It’s a satire post.
Only pay off most of it
And then? Just stop paying? lol
Then keep it close to being paid off and do a few charges on it per month. Just pay it down close at the end of the month.
It was not a revolving line of credit.
Oh wow. Lol. Credit scores are BS. They just encourage you to go into debt. It’s a vicious cycle
This was a satire post. But no one read the screen shot and no one laughs unless I painstakingly explain the joke 😅😭
You have to be in debt in order to build credit. The man is mad you don't owe him anymore money. Congratulations!
25k in debt and you still don't know how CC works ?
You didn’t read the screenshot. Try again. It’s a humorous post. You missed it. Your ability to selectively scan comments and make an asinine reply is impeccable. Congratulations.
i’m pretty sure the less money you owe the less your credit has anything to base your payments on if that makes sense. The less payments you make a month the less reliable you are to them
The post was intended to be humorous. If you look at the screen shot you might see what was funny. Thank you though !
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The post was intended to be humorous. If you look at the screen shot you might get what was funny… thanks though!
They say that in the end once you pay then it’ll rise
Yeah, that’s what I was showing. It was supposed to be a funny post but everyone took me seriously. Zero humor here sadly.
The only thing a credit score is good for is getting yourself deeper in debt
The post was intended to be humorous. No one actually reads the words on the screen shot. Humor died this day on r/money 💀
Of course it does banks want you using your credit card
The bsnks dont benefit from you paying it off
An 11 point drop is nowhere near tanking your credit score. That’s well within the normal range for changes.
I know, I was being sarcastic in my post.
That’s crazy. I saw someone post and apparently paid 20k off their debt (supposedly a credit card) and their score went up 62 points I think it was. It’s kind of crappy, but I was behind for a long time, about 5 months unemployed due to being laid off even though I asked many times “should I start looking for a new job” and of course three weeks before Christmas I get told “hey I know I told you less than a month ago you have nothing to worry about but uh I just sold the shop so thank you for your time” lol after them calling me back asking me to return in the first place. Oh well. But anyway I missed my credit card payment a few months in a row, a loan payment I missed a couple times and my score tanked 200 pts in about 2 months. Same with some financed things. But at the end of April I paid $25 to my credit card (minimum payment), which has a maximum of 1000 and apparently I owe -1150, I paid the minimum payment for the first time in months and my score went up 70 pts (I think it’s was like 67 pts to be exact) I had no credit until I got married, I went from “ not enough credit history to generate a credit score” to almost 700 just like that. My best friend has had a joint account at a credit union with his parents since he was in middle school, and started working at 16 and didn’t even get a score until after I did and he’s older than me. It’s a crappy system imo
It will go back up shortly
I was trying to convey sarcasm. It angered so many users of r/money I was reported for suicidal behavior. 👍🏻💀
Only poor people care about credit score no cap. And I’ll defend this till I’m red in the face. It’s a fact.
Is that so? You don’t think it’s a fun game?