02-22-2013 01:17 PM - edited 02-22-2013 01:30 PM
My AAoA is 2 years and my longest standing account is an electric bill that was charged off 7-2006. This account was opened In 2000 and is 12 years old. I have several new accounts and when the CO falls off, my AAoA will still be about 2 years because the newer accounts will have aged and my oldest account will be about 6 years old.
My question is. Will my score go up any after the CO falls off? Every other aspect of my credit profile will be clean. I have two installments open that are always paid on time and are 11 months old at this time and a total of 7 credit cards with $32000 credit line and I keep only one card showing a balance of less than 4%. I have 5 closed accounts that are all in good standing and then the 1 CO that will supposedly fall off 11-2013. The CO has never shown up in collections on my FICO reports.
Sorry if I am redundant but I guess my question is, Will the CO falling off help my credit score much?
Thank a lot
02-22-2013 03:35 PM
Kinda confused about the "fall-off" ...
When the charge-off reaches 7 yrs + 180 days from its DOFD, it will be excluded from your CR, but that wont result in the account itself being removed unless the creditor deletes the entire account. Thus, I dont see a drop in AAoA as a result ot CR exclusion of the CO.
If the CO is your only remaining major derog, then your file will move into a clean scoring categorization, and thus I would expect a good score boost.
02-22-2013 04:05 PM
Thank you for the info. May I ask why some things fall off after 7 years and why some fall off in 7 years and 180 days? I had a foreclosure fall off after 7 years.
02-22-2013 04:29 PM - edited 02-22-2013 04:33 PM
FCRA 605(a) requires any adverse item of information to be excluded at certain times. It lists specific items with their own indvidual periods, and groups any other adverse item into its own period.
The 7 years plus 180 day period from DOFD, as provided in sections 605(a)(4) (and as clarified by section 605(c)), applies only to collections and charge-offs.
Section 605(a)(5) is the catch-all subsection which encompasses "any other adverse item of information" not listed in one of the other subsections. The period for all the catch-all items is 7 years from their date of occurence. Monthly account delinquencies are the most common "catch-all" adverse item, but any other unspecfied item is included.