12-13-2012 07:09 AM
So I have a general grasp on how my credit would be changed if I cancel my cards. I get credit utilization/debt ratio etc. I have about 5 cards, only 1 has a balance that I pay off each month. Lets just say for simplicity sake one is 5 years old, one 4, one 3 and so on. This may be an all to simple question but if I cancel my 1 year old card, will that immediately change my average length of history? Or will it stay on there for 7-10 years like say a bad payment? I have no late payments for these cards so that wont really make any difference. My question is just if the math would be (5+4+3+2)/4 is my new average, or if for some reason it is different. Painfully simple question I apologize but I cannot find the answer online.
12-13-2012 07:23 AM
"Positive closed accounts remain 10 years."
"In terms of credit history, closed accounts are treated no differently than open accounts."
12-13-2012 07:24 AM
Positive closed accounts will continue to remain for 10 years from the date of closure, generally. There's no fixed rule on the length of reporting but 10 yrs is a guideline. So, if you close it it will continue to show on your CR and will continue to age and still will be included into your AAoA. Remember, AAoA is the average age of ALL of your OC accounts, whether opened or closed, good or bad. In your example, if you only have 4 accounts, your average would be 3 years, vs. 3.5 yrs, because FICO rounds AAoA down to the nearest whole number.
12-13-2012 09:43 AM
If you want an account removed from your AAoA calculation, you must get the credtior to delete it. The consumer cant "cancel" an account from reporting and scoring.
Length of credit has two major components... oldest, and average age.
Deletion of a younger account wont affect age of oldest, but will effect AAoA.
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