Which is worse: High utilization vs age of account?

[Anonymous]

I'm an AU user on my mom's credit card (limit of $5400). While it's been open since 2003 (yay!) with no missed payments, it's always at a 99% utilization rate (boo). Since it's my only card at the moment, this puts me at 99% for all of my revolving credit. I did sign up for a new credit card recently, but it's only a $500 limit... so I'll still have a high utilization rate.

I'm trying to decide if this is hurting me now more than helping me. What should I do?

1. Remove myself as an AU because of the utilization

2. Stay as an AU because of the age of the account

3. Remove myself but add myself back later whenever the card is finally paid down. 

[modernsurrender]

I've been wondering about that also... DF has a Cap1 card that I believe has a pretty decent CL on it and is at least 7+ years old.  I've been tempted to ask him to add me as an AU for the increase in AAoA since mine is probably going to plummet this year when several 7 year old baddies drop off and 3 new accounts begin reporting, but I worry about whether his high utilization on the card would outweigh the good it would do.

I'm also tempted to add him as an AU to my Southwest card once it arrives to help his utilization, but I don't know if the drop in AAoA will outweigh the benefit of the util decrease.

I look forward to seeing what experienced people have to say here hehe

[Anonymous]

The one question I can't answer is if dropping an account also removes the credit history (I would think not).   You will take a smaller hit closing a line of credit then having such a high util rate.    I got well over a 100 point bump lowering my util rate from 98% to 9%.    But...they added 1.5% to my loan because of a short history on major credit cards (2 years).  

Credit utilization is a big component of your rating, especially since you are near 100%, that is defined as an account in jeopardy of default.  If you keep it, get it down and also...it is based only on the prior month balances so a quick reduction really makes a difference (you will see a bounce typically within 1-5 days of statement date closing).

From what people tell me on here, all credit cards should be at zero with one carrying a utilization rate of below 10%.

[Crashem]

Use fico estimator to compare

[Booner72]

Your utilization far outweights (percentagewise) your AAoA.  Dh is down to only 1 year of AAoA due to all the new accounts this year - and he has gone from High 500's to over 700 across the board in 10 months.

I am CERTAIN that AU account is killing your score.  CERTAIN.

Length of credit is 15% of your score and amounts owed is 30%.  Twice the impact.  Just dispute it and they will remove it from your reports.  Calling the CCC to remove it will take forever, and okay to dispute as "not mine" because it really isn't yours.  If it hurts your score too much, then just have it added back on by having the card owner report you back as an AU.

[RobertEG]

+1

Length of credit is only 15%, and AAoA is only a part of that.  Revolving util is the major component of a 30% scoring category.

Being maxed in revolving util is a biggie.  FICO recently published a chart showing the usual impact of certain items, and I recall that being maxed or near maxed in % util was way up there in point impact.  Cant recall the actual number, but I think it was in the upper two digits.

Aside from the actual scoring impacts, having the credit history of another factored into your score kinda makes it impossible for a creditor to then use your score as an assessment of your own personal risk of delinquency.

I would ditch the AU status.

[rckstrscott]

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@Anonymous wrote:

I'm an AU user on my mom's credit card (limit of $5400). While it's been open since 2003 (yay!) with no missed payments, it's always at a 99% utilization rate (boo). Since it's my only card at the moment, this puts me at 99% for all of my revolving credit. I did sign up for a new credit card recently, but it's only a $500 limit... so I'll still have a high utilization rate.

I'm trying to decide if this is hurting me now more than helping me. What should I do?

1. Remove myself as an AU because of the utilization

2. Stay as an AU because of the age of the account

3. Remove myself but add myself back later whenever the card is finally paid down. 

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Wow.. yeah. This isn't even a question at all. Remove your AU status from that card. Even if your only credit card has a 6 month AAoA, you are better off removing that account.. esp with it being that high..

If it was like, carrying a 3000 balance of 5400? I wouldn't feel quite as confident, but if you are over 90 percent? Oh yeah.. that is killing your score, no doubt about it.

-scott

[Anonymous]

Thanks a ton for all of the advice!

I've removed myself from the card. How long before this change shows up on my credit report?