How much does your credit score drop after you pay off your student loans?
Recent graduate here with 37k in school loans. My mom is paying for my two private loans and I will be paying for the federal loans, which are about 20k. I am looking at a job that pays 60k and living at home. I have a goal to pay them off within 5 years, less if possible and the stars align, and was wondering how it would affect my credit score. Last time I checked, it was around 778 with a total account of 11, which will change if I pay them off (I'd still have 2 lines open). The length of credit is around 5 years- thanks mom for making me get a card young and buy a candy bar once a month to build it up. How much would my credit score decrease, if in 5 years, I manage to pay off all my loans? Will it bounce back? I've worked hard to get my score the score it is at my age so I don't want it getting ruined by paying them all off 5 years ahead of schedule/
- StephenWeinsteinLv 78 months ago
Not much and it might increase. If your score is already 778 (which is unusually high for a new graduate), then it will still be very high and you don't need to worry about this.
- rezaLv 68 months ago
You do realize that if you’re actually able to do that and pay off your loans that it won’t negatively effect your credit score right? Paying off owed debt increases your credit score..