Will paying off all my credit cards lower my credit score?

Typically it helps. Lower utilization is a key driver, so $0 balances often raise a credit score. Keep the accounts open to preserve available credit. For best results, let one card report a 1% to 9% balance, then pay it in full by the due date.

Should I pay off student loans before applying for a mortgage?

Often yes, if rates are high or payments strain debt-to-income. Paying off a student loan may trim your FICO score a few points by reducing credit mix, but lower monthly debt can improve approval odds and pricing. Time it 30 to 45 days before underwriting.

Is it better to close a credit card after payoff?

Usually no. Closing a card shrinks available credit and can raise utilization, which may lower a credit score. Keep the account open, set a small recurring charge, and autopay in full. Ask for a product change to a no-fee card if an annual fee applies.

How long until my credit score updates after I pay off debt?

Most lenders report monthly. Expect updates within 30 to 45 days after the statement showing a $0 balance closes. You can monitor progress with free reports from each bureau. If a balance fails to update, contact the lender and file a dispute if needed.

Global Market Insights

Credit Score Today, January 23: Will Paying Off Debt Hurt Your FICO?

ByHuzaifa Zahoor January 23, 2026January 23, 2026

Your credit score guides what you pay for mortgages, cards, and auto loans. Today, many ask if paying off debt with a $250,000 inheritance could hurt a credit score. Here is how FICO reacts when you clear credit cards and student loans, what may cause small dips, and how to plan the timing. We focus on mortgage shoppers in the US who want the best rate. We share steps to protect your FICO score while cutting interest costs and risk.