Will my credit score go up if I pay all my debts?

Will paying off debt increase my credit score?

Ugh, credit scores, right? Paying off debt should boost them, that's the general idea. But I learned this the hard way.

Last year, July 14th to be exact, I paid off a $2000 credit card – whoop-de-doo, right? My score actually dipped a few points. Turns out, closed accounts affect your score initially. Crazy.

It's not a huge deal, but it was annoying. My score bounced back quickly enough, though. The effect is usually temporary.

So yeah, generally paying down debt is good, but it’s not magic. The timing and how your lender reports it matter. Don't freak if you see a short-term drop. Keep up the good work.

In short: Paying off debt usually increases credit score, but temporary decreases are possible due to closed accounts affecting credit history.