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@Anonymous wrote:
My question is in relationship to "old accounts." When exactly do these old accounts come off, if ever? Does one have to request this thru EX, EQ or TU? Or should this automatically happen? We have some "old" credit that had some 30+, 60+ days late on it and would like to see it disappear. Does the amount of time start from the date the account was opened or from the last date it was late?Thanks,Firecat
@Anonymous wrote:
I have 2 open CC from Chase (10+ years old) which hasn't really been used in years. I recently got an offer for a zero percent balance transfer CC from Chase and wanted to consolidate the cards in order to combine and raise the credit limit. From my understanding, when I combine the older cards into this new one, the 2 old CCs will be closed. Based on what I understand so far, I believe that my card utilization percentage would stay the same since my credit limit adds up to the the same amount and I am just shifting the balance from one account to another. I am just worried about closing the aged CC accounts. I wanted to get feedback on if this merging of cards will have a negative impact on my credit score. Thanks in advance.
Tuscani wrote:[...]Lets recap... In the short term, the only harm by closing a revolving account is due to the utilization percentage you lose, while over the long term, a closed account will be removed from your credit file after 10 years, which could lower your score due to the loss of history.
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.
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.