Effect of refinanced student loans

[valley_man0505]

When I look at my CR's, they initially look worse than what they really are since I have about 5 or 6 student loans listed, which makes it look like I have a LOT of loans.  However, they all show $0 balance since they were refinanced into one loan.  Does having all the original loans listed have any effect on my score?  The "status" of these accounts is "renewed or refinanced".   They are not helping my length of history since these loans were from grad school.

[Anonymous]

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valley_man0505 wrote:

When I look at my CR's, they initially look worse than what they really are since I have about 5 or 6 student loans listed, which makes it look like I have a LOT of loans.  However, they all show $0 balance since they were refinanced into one loan.  Does having all the original loans listed have any effect on my score?  The "status" of these accounts is "renewed or refinanced".   They are not helping my length of history since these loans were from grad school.

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On the contrary, as long as they are reporting, they are helping your length of history.  All accounts are included in the age of accounts and payment history calculations, regardless of whether they are open or closed.

As long as there are no baddies associated with them, those old, closed accounts aren't hurting you one bit.

[Lel]

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@Anonymous wrote:

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@valley_man0505 wrote:

When I look at my CR's, they initially look worse than what they really are since I have about 5 or 6 student loans listed, which makes it look like I have a LOT of loans. However, they all show $0 balance since they were refinanced into one loan. Does having all the original loans listed have any effect on my score? The "status" of these accounts is "renewed or refinanced". They are not helping my length of history since these loans were from grad school.

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On the contrary, as long as they are reporting, they are helping your length of history. All accounts are included in the age of accounts and payment history calculations, regardless of whether they are open or closed.

As long as there are no baddies associated with them, those old, closed accounts aren't hurting you one bit.

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Agreed. I have lots of student loan accounts on my CR, even though they have all be consolidated into a single account. Since all of these loans originated between 1987 and 1990, they are all add up to a long average account age, definitely diluting out all those credit cards that I picked up in the 1990s to get 10% discounts on tires or a free box of golf balls (no kidding). I'm actually worried about what will happen when those accounts drop off, because my average account age will plummet.

[valley_man0505]

So, AVERAGE account age factors in?  I always thought it was just the length of your credit history.  My credit history starts in 1998 with a few small CC's that I never even used--they are all on my CR's, but are shown as "closed" with $0 and never late.  My score is being hurt by some baddies around 02-03.  After that, what little credit I have been able to get has been paid on time each month except for a period in 2005 where I found out my electric bill was 3 months late--my wife-at-the-time (we are now divorced) had been taking money out of the bank to pay the bills and I took her word for it only to find out months later that EVERYTHING (rent, electric, water, cable) was behind.  Luckily, only the electric bill got reported.

Hopefully, these student loans are in fact helping me.  I know the consolidation loan I am paying on for these loans is definitely having a huge impact since it is the only thing I have reporting now other than a small auto loan and a low CL secured CC.

[Lel]

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@valley_man0505 wrote:

So, AVERAGE account age factors in? I always thought it was just the length of your credit history. My credit history starts in 1998 with a few small CC's that I never even used--they are all on my CR's, but are shown as "closed" with $0 and never late. My score is being hurt by some baddies around 02-03. After that, what little credit I have been able to get has been paid on time each month except for a period in 2005 where I found out my electric bill was 3 months late--my wife-at-the-time (we are now divorced) had been taking money out of the bank to pay the bills and I took her word for it only to find out months later that EVERYTHING (rent, electric, water, cable) was behind. Luckily, only the electric bill got reported.

Hopefully, these student loans are in fact helping me. I know the consolidation loan I am paying on for these loans is definitely having a huge impact since it is the only thing I have reporting now other than a small auto loan and a low CL secured CC.

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Yes, it is my understanding that average account age factors in. On the Score Watch reports, it lists both the length of your credit history and the average account age.

My opinion is that the average age in many cases acts a surrogate marker for your credit-seeking behavior. If someone has only credit accounts that are 20 years old, then his/her average account age will be 20 years. However, if that same person suddenly went on a credit-card application spree, the average account age would drop precipitously. Thus, taking the average age into account can highlight potentially risky credit-seeking activity.

Nevertheless, having a long, established history is still good.

[haulingthescoreup]

I'm great on average age (19 years), but terrible on average age (under 3 years), and boy, am I getting spanked on this. So yes, it very much looks at both.