04/15/2026
🛑 The "Refinance Trap" That Ruins Perfect Credit Scores 📉
This is a massive PSA for anyone trading in a car or refinancing an auto loan. Do not make this rookie mistake! 🚫
Here is the scenario: You go to the dealership, trade in your car, or refinance it with a new bank. You think the deal is done, so you stop making payments to your original lender.
Big mistake. 🚩
I cannot tell you how many times I’ve seen a client get hit with a "Late" or "Derogatory" mark because the payoff check from the new bank took a few weeks to clear.
Even if you’ve technically sold the car, the original bank doesn’t care until the money is in their hand. If that check is delayed and you miss your due date, you ruin years of perfect payment history on one of your most valuable trade lines. 📉
💡 The Solution:
Keep paying the note until you see the check clear and the account closed.
If you make an extra payment, don't worry—the bank is required to mail you a refund check for the difference. 💸
It is much better to wait for a refund check than to fight a late payment on your credit report.
📢 Want to learn how to structure your credit profile to get approved for high-limit funding? Comment the word "Funding" if you want to get funding. 👇
