15% affects Established History. The longer you maintain open accounts with creditors the better. When first starting out of course this is not easy; but this is where getting added as an Authorized User to another persons established credit comes in best. Remember that the contributor must have an account that has long history; clean payment record; high credit limit; and low balance. Also need to check with the creditor to insure that they have a policy to report authorized user accounts to all three major credit reporting agencies.
Does anyone know if they use the oldest account age to figure this or the average account age?
FICO is developing a scoring formula that will exclude the AU factor in response to the accusation that inflated scores lent fire to this subprime lending mess. Especially since he advent of renting history to complete strangeers commercially. So yes the AU factor is in the process of being reoved. For more info on how the credit score is figured. Visit the Credit scoring 101 thread at the top of this board. The total length of credit and the average length of history are both factored into the equation. basically that means each new card reages your credit file a little more. Say you have a 10 year old card (the only one) you decide to open a new one today. Before openingthe new card both your credit file and average age are 10 years. After opening the new card although your credit file age is ten years, your average age has been reduced to 5.
As I mentioned on another thread, I have a lot of accounts with same company. I'd get one, keep a few months and pay off, thinking this was helping my credit. However, my oldest account is 6 years. But my average is 1 yr because of the # of accounts. So, if I sent this place a GW and asked them to stop reporting on some of the loans, my average age would rise.
My question is which would do me more harm to my credit score: Having a low average age of accounts(leaving things as is) or removing some good accounts to raise my average age of accounts?