I was approved for a auto loan in August, thanks to the what I learned on the creditnet.com forum. Thank you! Recently I came into a little wind fall and I am able to pay off my car loan. I have only been paying on it for eight months. I only have two other credit cards on my credit report. I am wondering if I pay off the auto loan it might hurt my credit score. I know that you should have a mix of accounts on your credit. This might help me decide if I should use the money to pay off the auto loan or just keep the money for emergency fund.
I would pay off the auto loan. I would rather save money on interested from paying off your auto loan then have the emergency fund. Or you could use part of it to pay off the auto loan and then save some for emergency fund. Are you credit cards paid down? If you are carrying balances on those I would pay those down as well. Thank you! Heather with BoostMyScore.NET
I was looking around on the website and found a blog post from Josh that relates to your question. Ask Creditnet: How Fast Should I Pay Off My Car Loan? - CreditCents Thanks! Heather with BoostMyScore.NET
Glad to hear you were approved for your loan based upon what you learned here. That's awesome! Do you not have a sufficient emergency fund to cover expenses for at least 6 months. If not, hold onto your windfall for that. If anything is left over, put it towards the auto loan as long as you're not carrying any other high-interest balances on your credit cards.
Thank you for all your help! This website is a great resource. I think I am going to save my extra money in a savings account for emergency.
Excellent choice. A healthy emergency fund is an extremely important part of anyone's personal financial plan. Find a high-yield online savings account that doesn't charge any fees and stash your cash in it. Aim for an EF that would cover 6-12 months of expenses. By the way, glad you like the site. Do us a favor and tell a friend or two about us . Have a great weekend!
