Military Significant Others and Spouse Support - MilitarySOS.com
Page 1 of 2 12 LastLast
Results 1 to 10 of 14

Thread: Would this be bad for my credit?

  1. Quis custodiet ipsos custodes?
    Tojai's Avatar
    Tojai is offline
    Quis custodiet ipsos custodes?
    Join Date
    Sep 2009
    Location
    St. Pete FL
    Posts
    30,026


    #1

    Would this be bad for my credit?

    Advertisements
    I still have $5000 left on my students loans. DH is wanting to pay it off right away (which we would be able to do without compromising our emergency fund or our regular savings, we have enough liquid assets that it fits in the budget). I definitely want to pay off one of them as soon as possible because the interest rate is 4.8%. That loan is $2500. The other $2500 however is at a 0.33% rate so I'm not super concerned about interest there (it is variable, so I guess I might be more concerned if it goes up really crazy).

    The only reason why I hesitate to pay it off right away is because one person I talked to about our credit said that it might not be a great idea to get rid of all of our debt. If we pay off the student loans entirely, then the only debt we have will be our mortgage. We do have one credit card but we don't carry a balance. So I guess one revolving line of credit, and then the mortgage. She said that if we don't owe enough money it could damage our credit score.

    I am kind of curious about our credit score, it was borked for a while because our DTI was messed up from owning two homes and not getting any income from the one we weren't living in. I'm going to pull our report in a few months (since we just sold the second home) to see what it looks like. But anyway what are ya'll's opinions on this?
  2. I'm not drunk, you're just blurry.
    amandalouwho2's Avatar
    amandalouwho2 is offline
    I'm not drunk, you're just blurry.
    Join Date
    Sep 2012
    Location
    Jarrell, Texas
    Posts
    10,443


    #2
    The best advice one of our home loan advisers gave us when we were trying to work on building our credit back up was to pay the debt down to 40% of what was owed and then make larger payments than the minimum. It gave my husband's credit score a massive boost when we did this with one of his credit cards. So that could be an option possibly? Just pay down the loans to a smaller amount and then pay it off gradually. Paying it off all at once won't negatively impact your credit I wouldn't think though.


  3. Quis custodiet ipsos custodes?
    Tojai's Avatar
    Tojai is offline
    Quis custodiet ipsos custodes?
    Join Date
    Sep 2009
    Location
    St. Pete FL
    Posts
    30,026


    #3
    Yeah that's kind of what I want to do, pay of the higher interest loan and just leave the rest since the interest is so low. I think DH just wants to get rid of it. I don't like debt either, but if it's good to have *some* debt besides our mortgage and the credit card then I'm ok with just paying them off over time.
  4. I'm not drunk, you're just blurry.
    amandalouwho2's Avatar
    amandalouwho2 is offline
    I'm not drunk, you're just blurry.
    Join Date
    Sep 2012
    Location
    Jarrell, Texas
    Posts
    10,443


    #4
    Quote Originally Posted by Tojai View Post
    Yeah that's kind of what I want to do, pay of the higher interest loan and just leave the rest since the interest is so low. I think DH just wants to get rid of it. I don't like debt either, but if it's good to have *some* debt besides our mortgage and the credit card then I'm ok with just paying them off over time.
    That would be a really smart thing to do! Just get rid of the one with the higher interest rate and then make payments on the other on! Girl I wish we could just get rid of my student loan debt I'll be paying that thing till I'm almost 50 at this rate!


  5. Dancing Backwards in High Heels
    HisJuliet's Avatar
    HisJuliet is offline
    Dancing Backwards in High Heels
    Join Date
    Nov 2010
    Location
    Together Again!
    Posts
    9,081
    #5
    Well, are you planning on buying anything on credit or refinancing your home any time soon? Because honestly if you are not planning on using credit anytime soon, I wouldn't be too worried about it.
  6. Quis custodiet ipsos custodes?
    Tojai's Avatar
    Tojai is offline
    Quis custodiet ipsos custodes?
    Join Date
    Sep 2009
    Location
    St. Pete FL
    Posts
    30,026


    #6
    We don't have any set plans but probably sometime in the future DH will need a new car, and we might finance some of it. But that's maybe a few years down the road ... actually by then the student loans will be paid off regardless so I guess the point would be somewhat moot. I just don't know how big a deal it is not carry "enough" debt ... to me the mortgage is plenty!
  7. Team Rocket
    rocket_lizz's Avatar
    rocket_lizz is offline
    Team Rocket
    Join Date
    Mar 2012
    Location
    San Diego!!!
    Posts
    9,069
    #7
    I've always heard that that cliche is BS I have no idea if it's legit but I've been told that you should ALWAYS strive to have less debt, especially if you had things in the past that helped build up credit already
    WiggleWiggle~ is my Wifey
  8. Senior Member
    Heisenberg's Avatar
    Heisenberg is offline
    Senior Member
    Join Date
    May 2011
    Location
    South Florida
    Posts
    16,413
    #8
    I've always heard the least amount possible is the best. My only debt is my car loan, which is less than $8000 at this point, and my credit is excellent.
  9. i request the highest of fives!
    lorem_ipsum's Avatar
    lorem_ipsum is offline
    i request the highest of fives!
    Join Date
    Jan 2011
    Location
    29palms
    Posts
    10,037
    #9
    that's a myth. pay it. pay it. pay it.
  10. MilitarySOS Jewel
    Procella's Avatar
    Procella is offline
    MilitarySOS Jewel
    Join Date
    Apr 2010
    Posts
    6,983
    #10
    It sounds like your finances are well rounded enough that you wouldn't have any problems securing a car loan. I say pay it off just for simplicities sake.
Page 1 of 2 12 LastLast

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •