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Personal Finance Q&A: Will an installment loan help credit score?
Personal Finance Q&A: Will an installment loan help credit score?

Dear Liz: I am working on paying my bad debt from the past to rebuild my scores. I have one credit card that I pay in full every month, but no installment loan. I recently was given the opportunity to take a car loan with monthly payments I could easily afford. Here is my confusion: Taking on more debt while trying to eliminate past debt is usually not advisable. But I also know creditors like to see both revolving and installment credit. Am I OK taking the car loan to give the "well-rounded use" credit, or should I just put that extra money to pay off my past debt? Answer: Paying off old bad debts typically doesn't help your credit scores. If these accounts are now in...

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