New credit status.

[Anonymous]

After applying for new cc, how long does it take for the CB to not see them as new accounts?

[csryang]

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@Anonymous wrote:
After applying for new cc, how long does it take for the CB to not see them as new accounts?

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Maybe someone else can chime in. Definition of "new" is either less than 6 months or less than 1 year.

I heard that inquiries from new accounts will no longer hurt credit score when they reach the 1 year mark. The majority of your FICO score should bounce back by the 6 month mark. New accounts will lower Average Age of Accounts initially and hence lower FICO score. Your score will only improve if other areas of your profile are unchanged.

In general CBs do not define new accounts I think. It's credit card companies that define what's new account to them and decide whether or not to lend you more credit. 

[Anonymous]

Csryang, that makes sense. A new credit line of 22k popped up today on TU and my score jumped up 22 points 😎

[csryang]

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@Anonymous wrote:
Csryang, that makes sense. A new credit line of 22k popped up today on TU and my score jumped up 22 points 😎

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I bet it's because your Utilization % (debt to credit ratio) is high before this new credit line application. 

Yeah new credit line mostly lower FICOscores but it can increase scores as well. New account increases your score because it gives you more credit and hence lower your Utilization % and then increase your score. If your Utilization % is the same before and after new credit line, your FICO score will actually become lower after new application. You can look up and read about factors that influence FICO score.

[Anonymous]

OP, just curious. How long has your Walmart card been? 

Of late, Synchrony has become generous and users can request a limit. If you have had this card more than 4 months, why don't you ask for CLI? If approved, the util ratio will go down further and chances of score increasing further.

[Revelate]

Depends on your scorecard possibly and bureau.

With my tax lien, I never ever had the new credit reason code and I never ever took a drop on any algorithm for getting a new tradeline (if I ignore the inquiry penalty) unless I cross an AAOA boundary and the only one of those I found was at the 2 year mark so far though my data at 1 year wasn't very good (and everyone else said 1 month was as good as 1 year 11 months so I did not go and get terribly clean for it... so many things going on with new files anyway).

Just some funsies from different algorithms.

At least for Experian on all models to my knowledge, inquiries go here:  You've recently been looking for credit.  Inquiries absolutely count the entire year on my data though they don't all count individually in my experience, and the 6 month rationale is other changes in the report... if you have a fixed file like mine on Beacon 5.0 where I can't get above 700 seemingly in years, and the number of inquiries determines whether I'm at 693 or 700 and I got explicit score shifts to the date on the inquiries being a year old, and also got that on TU FICO 8 too, I'm comfortable in stating they're a year penalty and there's no fading as has been proposed on that.

There's other reason codes which appears to be tradeline related which I saw when the tax lien vamoosed for a week on a FICO 04 model (EX FICO 3):

You opened a new credit account relatively recently.  

And on FICO 98 Bankcard (FICO 2 BC) which is probably useless but illustrative:

You've recently opened too many new credit accounts.

Stats on that file were 4 tradelines opened in 6/16, and the pull was from 12/16.  My tax lien unfortunately came back so I'm probably going to lose the reason codes for everything tradeline related unfortunately so I can't see the boundary in January, but just be aware that on some FICO models historically certainly when a lot of the testing was done on this stuff, there is a new tradeline penalty at some level and I don't think we're 100% certain when that fades.

[sjt]

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@Anonymous wrote:
After applying for new cc, how long does it take for the CB to not see them as new accounts?

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I was told that each CRA is slightly different. Someone from Experian told me 6 months.

[sjt]

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@Anonymous wrote:
Csryang, that makes sense. A new credit line of 22k popped up today on TU and my score jumped up 22 points 😎

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I took a hit when new accounts popped up on my CRA.

[Anonymous]

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@csryang wrote:

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New accounts will lower Average Age of Accounts initially and hence lower FICO score.

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Not necessarily.  AAoA is measured in whole number years, not decimals as any decimal is rounded down to the nearest whole number.  If one possesses 18 accounts on their credit report with an AAoA of 7.7 years and they open up a 19th account, their AAoA will drop to 7.3 years.  The .3 and .7 however are irrelevant as under FICO scoring both examples are viewed and scored as an AAoA of 7 years.  In this example, AAoA for this profile would not drop and there would be no score change due to the opening of an account.  If this same individual were to open TWO new accounts however, their AAoA would drop to 6.9 years which would be viewed and scored as 6 years.  If 6 years verses 7 years happens to be a threshold for AAoA relative to that person's file, they would experience a slight reduction in score.  However, 1 month later with the aging of their accounts they would reach 7.0 (7) years and gain back any points lost due to the AAoA reduction as they'd be back at their original AAoA again (scoring wise).