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rosangelica28

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If I finish paying off my mortgage will my credit score go up?

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There are many factors regarding your morgtage in relation to your credit worthieness/ score. I do not puport myself to be an expert, but can only give you answers/reasons that I feel will affect your score.

1. On time payments with your morgtage will keep your credit score high. If you have had late payments on this particular morgtage it could very well hurt you more by even having it around.

2. Paying off any loan will, in fact, hurt your credit score in the long run since it will eventually drop off your credit profile and, therefore, not be there to scream to lenders:

      a. Hey look at me, I'm a loan that has been paid on for xxxx years. I'm credit worthy.

      b. Hey look at me, I have had no late payments on this HUGE loan. I'm credit worthy.

      c. Hey look at me, I have equity that can be tied up and attached if I default on any other loan. I'm credit worthy.

3. Once you pay off your loan no one will ever see it again. Lenders want to see you paying interest on SOMETHING, no matter what it is. They want to make money off the interest. Why would they like someone that pays everything off, pays minimal interest and avoids any kind of late fees or the like. That is not conducive to a lucrative  business. What may happen or work to your advantage is that you are NOW able to use this house as collateral for future loans, which have NO bearing on your credit score, BUT have direct bearing on your interest rate determination at individual lenders.

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