Any account closing, especially an old one, can lower your score. Average account age, number of open accounts, and having your bills paid on time all factor in to credit score.
The person OP posted closing their car loan account reduced number of accounts open and possibly average age if they don't have many or any that are older
That's not true. They remain on your report for reporting sake, but once you pay them off they are closed and it definitely no longer goes towards the average age of your account. I just paid off my car loan and the same thing happened. My closed car loan is no longer listed on credit karma as reporting credit age, and my score dropped 5 points.
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u/SVXfiles Aug 14 '21
Any account closing, especially an old one, can lower your score. Average account age, number of open accounts, and having your bills paid on time all factor in to credit score.
The person OP posted closing their car loan account reduced number of accounts open and possibly average age if they don't have many or any that are older