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Improving credit rating

  • 18-07-2010 9:26am
    #1
    anthonyebyrne
    Registered Users, Registered Users 2 Posts: 9 ✭


    Does anyone know if repaying a personal loan ahead of time improves one's credit rating ?


Comments

  • #2
    GerardKeating
    Registered Users, Registered Users 2 Posts: 7,806 ✭✭✭GerardKeating


    anthonyebyrne wrote: »
    Does anyone know if repaying a personal loan ahead of time improves one's credit rating ?

    Depends if you have missed payments, your credit rating will have the last two years history of payments, so if you have a missed payments in the last two years, and clear the loan now, that missed payment will stay there for the next five years, whereas if you wait until the last missed payment is more that 2 years back and then clear, it's gone a lot sooner.


  • #3
    anthonyebyrne
    Registered Users, Registered Users 2 Posts: 9 ✭anthonyebyrne


    Thanks for the reply, I am 6 months in to a 24 month term. I haven't missed any payment. I have come into a few quid and can clear what I owe... I just wanted to know would I get a higher score if it was completed in full ahead of the loan's term.


  • #4
    gogo
    Registered Users, Registered Users 2 Posts: 1,452 ✭✭✭gogo


    You wouldnt increase your credit rating, you more maintain your rating if that makes sense. It will be noted on your credit rating report that it was paid off, buts that it. if you have a loan and you continue to pay it off then your credit rating increases as you are 'maintaining your loan'. Its not an overnight thing, building up your rating and maintaining it is a slow process.
    So while paying of the loan early wont hurt you, dont expect to see any significent changes on your rating because of it.


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