Hubby and I are planning on applying for a mortgage in a couple months. Right now we have small personal loan and an auto loan, both about 10% paid. Within the next month we are expecting a good sized financial windfall. After putting a nice chunk away for a down payment, I would like to pay off the personal loan and pay the auto down to 30% paid. My question is this: if we follow this plan, would it hurt our scores because we have one less installment loan? I know that any possible hit would be a temporary but I am curious.
For our credit mix we each have 4 revolvers (3 major CCs and a store card) and the two loans mentioned plus old paid off auto loans. My mind is blank on what else we need to optimize our scores other than maintaining <10% utilization.
Anyway, I look forward to reading everyone’s opinion about my plan and the possible effect on our scores.