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I don't mean to be out here defending credit scores as a concept, but mine never dropped. Not when I paid off individual student loan accounts, not when the US Federal loans came due after the pandemic pause and I paid them off in one lump sum either. Not when I paid off mybcsr loan either.

Technically the 3 companies that do these each have their own proprietary blend, but it is generally accepted that there are 5 C's to credit. Character, capacity, capital, collateral, and conditions ("Character" woukd be better described as "history" but that ruins the memnonic).

Which one of these would be negatively impacted by paying off a student loan? None of them! In fact, it improves your Character to pay off a loan successfully, and it improves your capacity to reduce your monthly minimum payments. For stuff like a car loan, paying that off improves your Collateral.

Every single time I have met anyone claiming that paying off a debt hurt their credit score, their story falls apart when I start asking questions. Oh it was actually not them, but a friend of a friend of a friend. Or maybe they also got in a fender Bender and added $3k to their credit card balance that month. Or paying off the debt and the decline in credit score were seperated by months.

What CAN happen is that some accounts only report credit history upon closure. My wife used to work for an "alternative energy supplier" where this was the case. Due to state protections they could not turn off electricity during the winter. People would rack up electric bills for 4 months without paying, then get their electric shut off and suddenly see a huge drop on their credit score out of nowhere. I have heard similar stories of landlords not reporting late rent payments for years until the tenant moves out. This was all years ago though so I'm nkt even sure if that's true anymore.