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Moderator Emeritus
ByrdMan
Posts: 7,975
Registered: ‎12-19-2007

Re: Closing Aged Accounts.. Yes It Is Ok

Another point in favor of not closing an account is that the 10 year removal after closing an account is not etched in stone. I closed a perfect pay history MBNA account in 2/2003. Sometime in 2004, the account history suddenly vaporized from all three reports. I am not able to get it back. I am positive that this is impacting my score dramatically, as its 8+ years is beyond my average age of 5-6 years old.
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Contributor
snookie
Posts: 77
Registered: ‎08-11-2007

Re: Closing Aged Accounts.. Yes It Is Ok



sonicblue wrote:
All things being equal, I've done the math (not a score, just on average age), and it is to your benefit (forgetting util) to close any account whose age is LESS than your overall average age of account.  Think about it, t=0: you have three accounts, ages 10, 8 and 3 years.  The average age is 7 years.  Ten years from now, t=10, they'll be 20, 18 and 13 years old, for an average age of 17 years.
 
If at t=0 I close the 3 year-old account, the current average age doesn't change since they don't fall off.  But at t=10, the then-13-year-old account will drop off, and my average age of account will be 19 years.  This is an increase over the 17 years had I done nothing.
 
I think the argument against is, it's a safe bet that at SOME point in that ten years, you will probably have opened something new.  At an extreme, let's say you open two accounts right at t=10.  Your account ages will be 20, 18, 13, 0 and 0, for an average age of 10.2.  If I had closed that account, it then falls off at t=10, leaving 20, 18, 0 and 0, an average of 7.6. 
In the end, it seems like it's not worth it to close accounts.  Keep the util, keep the history.  If you're worried about fraud, call the companies and put a freeze on the account.  If you really want to close accounts, close ones you've opened VERY recently, and if you're going to open anything new, do it asap.  The longer you wait into the ten-year drop-off window, the more it may potentially hurt you later.


But if that account fell off wouldn't your average age be 9.5?   And  the following year you'd have 21, 19, 1 and 1 which would raise you up to 10.5 so no real damage done right? 
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Epic Contributor
haulingthescoreup
Posts: 28,115
Registered: ‎04-01-2007

Re: Closing Aged Accounts.. Yes It Is Ok



ByrdMan wrote:
Another point in favor of not closing an account is that the 10 year removal after closing an account is not etched in stone. I closed a perfect pay history MBNA account in 2/2003. Sometime in 2004, the account history suddenly vaporized from all three reports. I am not able to get it back. I am positive that this is impacting my score dramatically, as its 8+ years is beyond my average age of 5-6 years old.

And this is a problem that seems to be occurring more and more frequently! It's pretty obvious that the CRAs' databases were not designed to handle the amount of activity that we put them through, especially those of us who use TrueCredit and other services to frequently check reports.

I had a report fall off of EQ, although not off of EX, and there's no practical way to get it back. It was a department store card, and the chain has been bought and sold repeatedly. I can't begin to guess where I would start trying to find someone who had access to the records of the account. When it fell off, my average age went from 5-something years to 4 years, 10 months (maybe 11?) Not the end of the world, but I can't afford to lose old accounts, especially not early.
* Credit is a wonderful servant, but a terrible master. * Who's the boss --you or your credit?
FICO's: EQ 781 - TU 793 - EX 779 (from PSECU) - Done credit hunting; having fun with credit gardening. - EQ 590 on 5/14/2007
Member
sonicblue
Posts: 5
Registered: ‎02-29-2008

Re: Closing Aged Accounts.. Yes It Is Ok


snookie wrote:
 
But if that account fell off wouldn't your average age be 9.5?   And  the following year you'd have 21, 19, 1 and 1 which would raise you up to 10.5 so no real damage done right? 

aw, crap, did I mess up the math?  anyway...don't close accounts unless you plan to completely stop getting new accounts ;-)
New Member
money4nothing
Posts: 5
Registered: ‎01-26-2008

Re: Closing Aged Accounts.. Yes It Is Ok

Just read the string about the Amex Oasis program and others with problems with Amex.... and now the thread on closing accounts and aging. I am working on rebuilding my credit scores from some stupid and lazy mistakes....while I am making great progress thanks to the folks here...moved both wife and my credit score over 75 points in the last 6 weeks...expect another 50 point in the next month or two as a few more fixes hit the reports. Biggest issue now is I closed most of my cards 3-4 years ago and replaced them...so my "open" credit age is pretty short and counting against me on the scores. I bring this up here because one of the cards I had closed after having it open since 1986 is an Amex. I thought I read somewhere here about getting a closed account --with no negatives -- re-opened. If that is the case I would love to re-open this card so I can get a boost in my "credit age". Any advice on how to do this? Thanks
New Visitor
follyfox64
Posts: 1
Registered: ‎06-25-2008

Re: Closing Aged Accounts.. Yes It Is Ok

Hello,
 
I have read the threads and I am still confused.  My situation is this.  I have an average credit score of 750.  I want to raise it.  One of the negative points noted is the fact that I have about 42 open accounts.  Now almost all of these are credit cards that offered 20% off if I opened an account.  So I did.  All have 0 balance.  Some are very old.  Do I close these accounts?  Do I leave these accounts as they are?  I actually have to go through these "42" accounts to see what they are.  I cannot beleive I have that many. 
 
Thank you for your assistance.
 
 
Senior Contributor
smallfry
Posts: 4,831
Registered: ‎04-20-2007

Re: Closing Aged Accounts.. Yes It Is Ok

Most of these are store accounts? Need to know average of according to FICO. How old are you? Do you need most of these lines for utilization or are most "toy" lines? Closing a lot of these might have little or quite an effect on your scores down the line but we need more info to make an intelligent guess. :smileyhappy:
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Community Leader
Epic Contributor
haulingthescoreup
Posts: 28,115
Registered: ‎04-01-2007

Re: Closing Aged Accounts.. Yes It Is Ok

eaunspa's post has been moved to join a duplicate post over on General Credit Issues titled "Confused and Frustrated." Please, everyone, do NOT post duplicates. It just creates a mess, and the answers that you get become splintered.

Contributor
tryingtoreach700
Posts: 94
Registered: ‎03-02-2008

Re: Closing Aged Accounts.. Yes It Is Ok

[ Edited ]

Brammy wrote:
Other than the utilization factor, the only problem I see is that once the trade line is purged from your reports, it can seriously reage your credit history if you had not opened other accounts within a short period of time.
I have seen old closed accounts fall off due to age and significant score drops when a person had not applied for credit for a numebr of years between that old one and the next oldest one.  My current file is only 9 years old (putting it into the class of a young file) and I have had credit for a little over twenty years, my old info has since fallen offf and there was a long period of time, maybe ten years where I did not app for any new credit.  My current oldest accounts may start falling off in the next two years as they are installments, and those only show up on one bureau.


Message Edited by Brammy on 08-17-2007 09:45 AM

 

This is what I'm very worried about. I have my oldest account set to come off soon. Instead of my oldest account being opened 13 years it is  set to fall off. It's coming off  EQ in September.:smileysad:  I have some accounts opened up the few years after that that will start falling off because they were installments or I closed the CC's after I paid them off. Then it wasn't untill 07 that I decided I needed credit again. Im gonna be ^$^$&!! . Ive already called & of course it is now another company & can't be reopened. I can apply for a new card! The others mostly they say they have no info on me! My oldest & average age is going to suck. I'm hoping maybe some new scoring will go into affect before my GAP of not using credit hits! I regret closing anything!! I won't do it again. my 1st new card after my Gap sucks, has an annual fee, its crap one, but I gotta see in a year this may be my oldest account. I dont want it falling off in 10 years , I'll leave it open for the next 30 years if I have too. I'm hoping I want have a problem with all 3 bureaus because some of those old accounts still say open , even though they arent, & arent reporting. Maybe they will stay forever!  

 

Soorry forgot to quote BRAMMY.

Message Edited by tryingtoreach700 on 03-19-2009 04:31 PM
3 09 EQ 802 TU 695 EX???
3 09 EQ 802 TU 693 EX ???
JAN EQ 791 TU 685 EX 693
New Member
devlpr
Posts: 4
Registered: ‎01-14-2008

Re: Closing Aged Accounts.. Yes It Is Ok

This revelation is EXTREMELY helpful for when (due to the new credit legislation that was recently approved) the credit card companies start charging annual dues for us good credit users.  I was worried about closing accounts that will get too expensive to keep open and the effect of those closures on the "aged" history calculation. 

 

Now if FICO can just figure out how to address the issue of involuntary credit line decreases and the effect on overall utilization that I have no control over.

 

 


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