Understanding FICO® Scoring

[dogman]

Under FICO® Score Summary:

Length of credit history
How long you've had credit.
Very Good

What’s hurting your FICO score:
The negative factors listed here are reasons why your FICO score is not higher.

You have a short credit history.

Your FICO score measures the age of your oldest account and the average age of your accounts. In your case, either your oldest account was opened recently or the average age of your accounts is relatively low.

If the length of my credit history is very good, why is it hurting my FICO score?? This make no sence!

[Tuscani]

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dogman wrote:
Under FICO® Score Summary:

Length of credit history
How long you've had credit.
Very Good

What’s hurting your FICO score:
The negative factors listed here are reasons why your FICO score is not higher.

You have a short credit history.

Your FICO score measures the age of your oldest account and the average age of your accounts. In your case, either your oldest account was opened recently or the average age of your accounts is relatively low.

If the length of my credit history is very good, why is it hurting my FICO score?? This make no sence!

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What it means is while you current length is good, someone who is retired with 0 debt and 20+ yr TLs would be better.

[LadyFICO]

What does your credit file look like? Is it thin with only a couple of things reporting? If you have an extensive profile, I'm wondering if they just put something there to fill in a blank, are your scores good?

[dogman]

FICO score = 672
I have 6 open TL's with no lates, 4 closed TL's with no lates, 8 open IIB TL's (I don't know why they are open. I posted about this on the general credit issues forum, and 1 closed IIB TL.
1 BK from 7/2005

Average age of your accounts
6 years
Most FICO High Achievers [?] have an average age of accounts between 6 and 12 years.


On another note, I saw this from my EX report:
"Understanding Your FICO® Score
What’s helping your FICO score
This page normally lists the information that is on your credit report that is helping your FICO score. Experian does not supply us with information for this section but credit reports from Equifax or TransUnion do. So please make sure you check this page with your FICO score and credit report from Equifax or TransUnion to see what you are doing right with your credit."

So the CRA's supply the positive and negative information? Can't FICO gather the data and figure out what the positive and negative factors are???? I don't see why a CRA would be the one deciding what the negative factors are and supplying that information. I thought that was the job of fair issac. So possibly on my EQ FICO report, fair isaac thinks my history is very good but EQ thinks it's bad. Could that be it? So is it FICO or the CRA's who determine my score?

[MercyMe]

Dogman, I'm laughing, having recently received a similar comment which stated the average age of my credit accounts was three years, inspite of the fact that I have been in the system since 1987, upon the purchase of our home, and there after a home improvement loan which was also taken out in 1987, and which still reports.  That's 20 years of history which seems to have sailed off to sea because of three credit cards I acquired within the last two years.  Go figure.  If you can conjur up a solution to this, I'd sure be interested in hearing it!

[MercyMe]

Now that I'm not laughing ...  the reason given as to why my credit score isn't higher is because my credit history too short.  Your oldest account is 180 months old.   It says.  Your most recent account is 6 months old, it says, and this gives me a three year average?  Seems to me, someone at Equifax should learn how to divide, like 12 into 180, huh? 

No offense to Equifax, Barry, but ....

[HouseHunter]

From the "Understanding your score" section of my FICO report:

Your FICO score measures the age of your oldest account and the average age of your  accounts. In your case, either your oldest account was opened recently or the average age of your accounts is relatively low. People that do not frequently open new accounts and have longer credit histories generally pose less risk to lenders. Therefore, as your credit history lengthens and you pay your bills on time, this factor should have less of a negative impact on your score.

Example:  I have two lines of credit reporting on one of my reports.  One is 9 months and the other is 3 months which equals 12 months divided by 2 TL's is a 6 month average.

On another report, I also have only 2 TL's reporting.  One is an old lease I cosigned and the other is my 9 month TL.     108 months + 9 months = 117 months divided by 2 is 58.5 months.  So the average age of my accounts goes from 9 years to 5 years.