Yes. it can happen, I had a similar thing happen to me when I paid off the last of a student loan and my credit cards.

In the current economic context, it is essential to have a good credit score. Also people with a quite good credit score are scrutinized more closely than they were in the past. So, let's discover together the secrets to boost your credit score. Keep reading

Nowadays, it pays to have good credit. The days of the sub-prime borrower are over. Even those consumers with a pretty good credit score are scrutinized more closely than they were in past times. Being clueless about your credit doesn't let you off the hook. It only makes matters worse.

It's very important that you go into this knowing that it will take time to get rid of your debts, so don't lose heart. You can create new and better habits as long as you persist and give them enough time to become automatic.

And if you mess it up, just dust yourself off and assess the damage, then come up with a plan to keep going in the right direction.

In this completely comprehensive guide, you'll learn:

• Understanding the secrets of Credit Score calculation
• How to Manage your Credit Cards and your debt
• Ways to Make And Save More Money With A Higher Credit Score
• Tips And Tricks To Raise Your Credit Score
• Most Common Errors In Credit Reports and How To Avoid Them
• Techniques to Rebuild your Credit

... and much more

Let me explain why if you pay off your debt early your credit score could go down. Your credit score is made up of several different factors including usage, payment history, recent inquiries, number of loans, etc. When you pay off an installment loan and close it out, you are eliminating one component of what makes up your credit score. As a result, your score drops slightly.

If you have limited credit history, it is best to leave the account open until you are approved for other accounts. According to Experian, a major credit reporting bureau, open and active accounts are scored higher than closed accounts. Paying off the loan early can save you some money in interest, but it does not help your credit. The type of credit you have also affects your score. A credit mix, including both installment and revolving accounts, tends to a higher score than having only one type of credit.

Be cognizant of what your credit history says about you as a borrower and realize that what you don't know about your credit can hurt you. Your credit score is a reflection of your actions or most importantly, your inaction. The key to good credit is making choices responsibly.