Granny, it may not be such a "safe assumption." New accounts do not have only a "one category" effect on FICO scoring. What you can clearly expect, as the new account nears and goes over one year, is drop off of the effect of the inquiry that was reported to estblish the new account. So you willl get a gain in the new inq. category. But new inquiries are both fleeting in time importance, being only 10% of FICO score, and dropping off at one year.
More important and long-lasting categories are affected. For example, if your avg age of accounts was not high before the new accounts were added, then the adverse affect of adding accounts with relativley zero age on the overall lenght of credit category will mathematically hurt FICO, and FICO is math.
So, on to the new accounts themselves, once established. Instant joy! I now have a higher overall CL!!! Neat! But... . if the new accounts added were low CL accounts, even low balances against them will result in higher %util against them individually, even though overall %util may decrease. And, aside from %util alone, it may also result in a higher number of revolving accounts with balances. For example, if you had three CCs before opening the new ones, and only one reported balances each month, you were in good shape with only 1/3 of your cards showing balances. But with the addition of, for example three new accounts, then if only two of those three new accounts show balances next month,then you are now at over 50% of cards showing balances. FICO also scores this. And further, if one new card is a low $300 CL card, and you charge $200 on it next month, you are at 67% util on that card.
So, questions to ask: How much did the new cards affect your avg age? And as you have used the new accounts,what is the %util and balance on each after they were added?
IMHO, adding new accounts may add instant increase in overall CL, and thus appear as only a positive, but it is not that simple. They also add the burden of additional monitoring each for their impact in the other FICO factors, of which %util of each card, zero+ age on the new card, and number of cards with balances, is also very important.
So, IMHO, it is not a "safe assumption" that new card impact will disappear into the FICO ether of non-importance after six months or even one year. It is not a simle question for which one can expect a simple answer, It is all in your hands.
Message Edited by RobertEG on
04-05-2008 02:46 PMMessage Edited by RobertEG on
04-05-2008 03:52 PMMessage Edited by RobertEG on
04-05-2008 04:02 PM