Does a Fast Payoff Affect Your Credit Score?

June 5, 2000, Reviewed February 4, 2011

"We recently purchased a house. Before the first payment was due, I was unexpectedly offered an advantageous position that requires relocation. We will need to buy a new house and get a new mortgage. Will paying off the loan so quickly hurt our ability to get a new loan?"


No. An early payoff will not violate the terms of your contract. While the payoff is reported to the credit reporting agencies, it is not viewed as derogatory information that affects your creditworthiness.

Of course, lenders don't like losing a loan after one month, but they know that it happens occasionally from situations exactly like yours. They know that no one in their right mind buys a house with the intention of staying only one month.

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