Clark Howard Tells Debt-Free Dad to Back Off: Let Your Daughter Pay Her Last $1,000

Quick Read Continuing to make the final $1,000 payments on a young borrower’s car loan builds more payment history (35% of FICO score) and maintains the installment loan account that diversifies her credit mix, preventing a premature loss of points if paid off early. Paying off the loan early removes the primary credit-building benefit for a young borrower with limited history, while the remaining $1,000 balance has negligible financial impact on the parents’ debt-free status or the daughter’s finances ...