Understanding FICO® Scoring

[Esteban5]

Thanks for the comments everybody....it's actually WORSE than I thought.  I did full reports on all 3 bureaus and have evidently slipped even further as of this moment:

EQ: 763

TU:  760

EX:  759

At least 11 of the 30-32 accounts I have listed are paid and closed or paid and inactive (many over 6 or 7 years old)....these are hurting my FICO score, according to the reports.

Date of Last Activity:

Macy's - June 2001

Macy's -  December 2002

GEMB/JCP - April 2001

GEMB/ROBSG - November 2000

HSBC - January 2001

BofA - March 2002

WACH - May 2001

MB Fin. - November 2000

BP/Citi - November 2001

FUSA - July 2001

WAMU/Fannie Mae - April 2001

I have no late payments of any kind.

Can I request to have these old/inactive accounts removed? 

HELP!  I'm shopping for a home at the present time.

[psychic]

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Esteban5 wrote:

Thanks for the comments everybody....it's actually WORSE than I thought.  I did full reports on all 3 bureaus and have evidently slipped even further as of this moment:

EQ: 763

TU:  760

EX:  759

At least 11 of the 30-32 accounts I have listed are paid and closed or paid and inactive (many over 6 or 7 years old)....these are hurting my FICO score, according to the reports.

Date of Last Activity:

Macy's - June 2001

Macy's -  December 2002

GEMB/JCP - April 2001

GEMB/ROBSG - November 2000

HSBC - January 2001

BofA - March 2002

WACH - May 2001

MB Fin. - November 2000

BP/Citi - November 2001

FUSA - July 2001

WAMU/Fannie Mae - April 2001

I have no late payments of any kind.

Can I request to have these old/inactive accounts removed? 

HELP!  I'm shopping for a home at the present time.

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I see that Timothy answered your similar question posted on the Credit Card board--

http://ficoforums.myfico.com/fico/board/message?board.id=creditcard&message.id=69185#M69185

[TexMontana]

"HELP!  I'm shopping for a home at the present time."

You qualify for prime as it is, so no need to worry.

Not hurting you, as it ages your history nicely. You could always ask that the accounts be reopened...IF they will use the SAME accont info, and not report it as new.

[stevie2]

Previously being in sales, I have literally seen thousands of credit files, if not 10's of thousands.  One thing I have noticed about many "high achievers" is that you really do not have to be 90 years old with 19 year old credit cards.

For instance, I have a friend who merely had two credit cards on her credit file.  They body had limits around $5000, and balances somewhere in the hundreds.  It appears she had the cards for about three or four years.  Her FICO when she purchased a vehicle from me?  795!

My nephew, although not 760 or higher, opened a credit card with a $1000 limit when 18.  I urged him not to use it, and he listened.  Within six months, he purchased a vehicle, and we pulled his FICO at 703 at that time.

My score was in the upper 700's in the past.  At the time, I had about four credit cards (MC/VISA) on which I rarely carried balances, three student loans I paid off that same year, and three car loans ($17k, $30k, and $40k) I paid the $17k off in 3 1/2 years, but the others were paid off within a year or two.

My parents pay cash for everything, but my mom decided to finance a time share for the heck of it.  After over three years, her credit score is hardly 600!  Although she doesn't really care, I find this extremely disturbing! 

It looks like the key is mainly to do well on credit cards, and as long as you keep very low balances on just a few credit cards, your score can go very high within a short period of time.

[Esteban5]

I decided to request all 3 credit bureau reports and asked them to remove any information about closed with $0 balance accounts older than 7 years old....that should reduce the total number of accounts from about 30 to about 20.

Not sure what the impact of being "re-bucketed" will be....time will tell, I suppose.  In all, I lost 40+ points by using too many cards, having too many accounts and (presumably) being re-bucketed.

The only remaining card with a shown balance is AMEX - but that is paid off monthly.  I'll let you all know how things shake out in the next 4 to 8 weeks. 

[haulingthescoreup]

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Esteban5 wrote:

I decided to request all 3 credit bureau reports and asked them to remove any information about closed with $0 balance accounts older than 7 years old....that should reduce the total number of accounts from about 30 to about 20.

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!

May I have them, please? whew...

[smallfry]

Esteban why would you do that?

[haulingthescoreup]

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smallfry wrote:
Esteban why would you do that?

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Agreed! Esteban, when I read your post, it sounded like you had already done it; I thought it was a done deal. But if you haven't, and if you're determined to dump some accounts, you want to look at spreading them out according to their ages, and especially targeting those that are YOUNGER (not older) than your current average age. When they finally stop reporting, this will shift your average age to a higher figure, not a lower figure.

But whatever score ding there is for "too many accounts", I don't think that it's a biggie. You're looking at some possible trouble on down the road.

I guess I've just never know anyone with oodles of accounts of all ages, all of them with clean histories, that appear expendable. Most of us are clinging to any clean account we have!

[smallfry]

The score ding for over 30 accounts is minimal. I wish I had my 30 something year old Chase card on my reports.

[Esteban5]

We can just treat this as a learning process.  Yes, I've already made the requests to the 3 bureaus. 

IMO, I can't go down any further than the 40+ points I've been dinged by putting a haircut (less than $20) on one inactive Visa and a tank of fuel on another inactive Visa ($50).  Both credit limits on these cards are over $15K each.  Not sure how much the re-bucket has contributed, but we can all just treat this as an experiment - using my FICO score.

The 10-12 accounts (the actual number depending on which bureau) I've requested to be removed are not the oldest accounts I have.  One of the inactive Visas I used is 16 years old, the other is over 10 years old.

The accounts I'm attempting to prune from my reports consist of the following (and most should have fallen off on their own already):

Macy's - June 2001

Macy's -  December 2002

GEMB/JCP - April 2001

GEMB/ROBSG - November 2000

HSBC - January 2001

BofA - March 2002

WACH - May 2001

MB Fin. - November 2000

BP/Citi - November 2001

FUSA - July 2001

WAMU/Fannie Mae - April 2001

The accounts I still use (one Visa for business, one Visa for personal and AMEX) have reported balances, but are paid in full each month - and these accounts are 16-18 years old, so I really doubt the pruning of some younger, inactive accounts will have a negative impact....but we shall see.  Two of the three bureaus are reporting my HELOC ($10K balance) as a revolving credit account - I've asked them to classify it as Real Estate, which should shed some different light on the scoring of that account.

So, here's where I see the "Silver Lining"....

1.  The zero balances on the two Visas will be reported as $0 again in the next 4-8 weeks.

2.  The re-bucket should have worked it's magic in the same time frame

3.  Total number of accounts should be under the target number of 30

4.  The HELOC should be re-classified as real estate as opposed to a standard revolving (cc account) on 2 of the 3 bureaus

5.  The HELOC will be paid off by year-end

I'll update this information as time marches on to show what the effects are....

As someone else mentioned (and have confirmed this with my mortgage broker), I still qualify for Tier 1 credit, so if we end up placing a contract on a home - we won't have any trouble.

.....and to think a haircut and a tank of fuel is what started this avalanche...

Message Edited by Esteban5 on 04-15-2008 04:32 AM

Message Edited by Esteban5 on 04-15-2008 04:36 AM

Message Edited by Esteban5 on 04-15-2008 04:37 AM