Length of credit effects on mortgage and FICO

[Anonymous]

Hello all. I am thinking of applying for a mortgage in probably about 18 months when my inquiries from a recent app spree go away. I have old school loans and one old line of credit opened in 1997 that are all closed/paid/in good standing. They were all last reported in 2010. So in 2020 they are going to fall off my reports. The problem is I have a big gap in my credit history between those old closed accounts and my current/open credit. I currently have 8 revolving lines totalling $30k CL. the oldest is only 25 months and 3 brand new lines. My current age is 20 years from that line of credit opened in 1997. once that drops off in 3 years i will take a nose dive on the age down to 5 years. how much of a hit am i going to take on my FICO scores. And more importantly should i try and apply for a mortgage before those old accounts drop off and my age bites the dust.  any help would be appreciated.

As sort of a side not, what minimum age of credit do mortgage lenders like to see? My average age of open accounts right now is only 10 months. 

[Anonymous]

My current average age of accounts is 1.5-2.5 years old. My lender never brought up how old or new my accounts are. My lender also advised me to get a credit card while we are in the process of getting approved  for a home. 

Different lenders have different requirements. 

[Anonymous]

I am curious how much of a dropin my FICO'S i will have when my age drops from 20 years to 5 years. I currently have an average FICO 8 between the 3 bureaus of 760. 

[Anonymous]

You should head over to the Understanding FICO Scoring threads. It's important to remember that when applying for a mortgage, your FICO 08 scores is not what lenders use. If you subscribe to the myFICO account, preferably the Premier 3B, you can get access to your mortgage scores monthly for $29.95/month. 

[Revelate]

It's still possible to hit 740 on EX v2 and TU 04 even with 3 years AAOA and 9 years oldest account, and those scores were with a 30D and 60D late too which suggests you shouldn't have much trouble; I think with how the scorecards work for FICO I should be higher than that without lates once my lien pops off EX in a few months and I'm just fine hanging out at 742 on TU.

I should have some better information in another couple of months for short file scoring but there are some issues with my file specific to mortgage versions (the consumer finance tag may be a gnarly penalty on FICO 04 and I have one on EQ) which may hamper it.  While my personal thinking is it's better to get out of renting sooner rather than later and while it would certainly help to pull the trigger before the old information falls off, ultimately if you're above 740 it might not matter much, and above 760 it won't matter at all.