I had an auto loan with a high original balance but I had paid off about half of it at a higher interest rate. When rates came down and and I was able to, I refinanced it at a much lower interest rate zeroing out my original loan. The original loan company, once paid off, closed the account, something I wasn't thinking they'd do, I thought they had to note the balance as zero but not just close the account. So now I have a better interest rate but what looks like a new maxed out loan balance hurting my score and a loan that helped my score closed. Any way to resolve that issue?
Your paid loan is closed--it's paid off. An auto loan isn't like a credit card, where you keep using it. It should show a zero balance, paid in full. And the new loan is just that--a new loan. You say it appears "maxed out." Again, it's not like a credit card. Both should be reporting as installment loans, with the correct balance. Installment loans aren't counted in your utilization ratio. Make sure you have actual reports from each bureau, not the 3-in-1 online reports, because they don't show all the information like the individual reports do. When you get them, examine them carefully. If something isn't reporting correctly, dispute that part of the item with the credit bureaus. For example, if they still show a balance on the paid loan, dispute as "this loan is paid in full." That should get it updated correctly.
