Understanding FICO® Scoring

[MBOhio2]

My oldest credit account (a CC) was opened in Dec 2000. That means that it officially turned 11 years old about a month ago. I pulled my EQ credit report from here on Jan 21st and it still says that my credit age is 10 years. Two questions:

1) When will this account's "birthday" be recognized and therefore, show my credit age as 11 years on my credit report? AND

2) I know that going from 10 years to 11 is pretty random and not really a milestone, but do you think I'll get any score boost from my oldest account becoming a year older? In theory, does each year count or are there milestone marks?

[To-Be-Continued]

The 12 years is the AAOA (average age of accounts) If you have more than one account reporting account#1 12 years account #2 10 years the aaoa is 11 years.

Example:

Account #1 12 years X 12 gives you 144 months

Account #2 10 years X 12 gives you 120 months

Add month totals for 1 and 2 = 264/12 = 22/2 = 11

Hope this helps

TBC

[MBOhio2]

I understand how AAOA works... my AAOA is about 6.5 years, but my questions is about the age of my oldest account.

[To-Be-Continued]

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MBOhio2 wrote:

I understand how AAOA works... My AAOA is about 6.5 years, but my questions is about the age of my oldest account.

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Yeah that is strange I just looked at mine and it said my oldest account is 12 Years, 4 Months. So it is strange that it is not giving you months.

TBC

[llecs]

OP, It will turn 12 years old in December (well, November would make it exactly 12 to be precise). FICO reads off the month and year, not just year when determining the age of account. The only thing that is measured as a whole year is AAoA. Individual ages factor in the month and year. I once saw a significant bump when my oldest his a half-year birthday (I think 11.5 IIRC) when pulling my FICO on the last day of the month and again the next day, with no other changes.

[MBOhio2]

Thanks for all of the responses!

[RobertEG]

Age of credit history is a mix of criteria, for which Fair Isaac has not published how the components are weighted, or even what they all are.

It definately includes both AAoA and oldest account, but most probably includes some consideration of new accts less than, for example, 6 months or a year.

Who knows for sure...

There is no way to isolate the specific impact of age of oldest account without knowing the innards of the FICO algorithm.

Anecdotal experiences are not very helpful due to the many changing factors over time.

[jello77]

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RobertEG wrote:

Age of credit history is a mix of criteria for which Fair Isaac has not published how the components are weighted or even what they all are. It definately includes both AAoA and oldest account, but most probably includes some consideration of new accts.

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Although FICO has not said exactly how the components are weighted, it has actually described the components quite fully, including the fact that new accounts are taken into consideration.

Linked below is a FICO-sponsored page that describes in detail the 5 major categories that affect your score.

http://scoreinfo.org/FICO-Scores/Score-Ingredients.aspx

Here is what it says about age of credit history:

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Length of Credit History

Approximately 15% of your Score is based on:

-- How long your credit accounts have been established

    FICO considers:

                 --- age of your oldest account

                 --- age of your newest account

                 --- average age of all your accounts.

-- How long specific credit accounts have been established.

--How long it has been since you used certain accounts.

[IOBA]

MBOhio2 - to add what others have shared....

Per Experian, the AAoA buckets are -

0-3 yrs

3-5 yrs

5-8 yrs

8-12 yrs

12+ yrs

The one account aging will increase your overall AAoA and bring you closer to the next bucket.   When you are near the top (or at the top) of your AAoA bucket, your score is usually pretty high compared to others in the same bucket.   When you age into the next bucket, you may experience a score drop becuase you are being compared to everyone else in that bucket.

[jello77]

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IOBA wrote:

Per Experian, the AAoA buckets are

0-3 yrs

3-5 yrs

5-8 yrs

8-12 yrs

12+ yrs

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Many thanks for this info. I am trying to learn more about buckets (officially called scorecards).

I always thought the age-related buckets were based on age of oldest account rather than average age.

Do you have a link or source where Experian provided this info?