Valued Member
algorithmslave
Posts: 68
Registered: ‎09-10-2012
Re: Closing Aged Accounts.. Yes It Is Ok

The information provided here stands to reason. If it was not true it would not be fair, ie....if someone has two revolving accounts and two installment loans all with a late payment or two but closes all out with PIF and closes at consumer discretion, than only the negative would count and thus completly wreck ones score. This would not be an accurate snap shot of ones ability to manage credit. Thus by counting closed accounts, it would fix this issue. I think that made since........:smileysurprised:

You can wrap me in your flag, make me say a praise to your creator and make me spend your currency, but remember this, I am a loyal servant to Justice and a Patriot to none. I am free...
New Member
youngwidow
Posts: 4
Registered: ‎09-15-2012
Re: Closing Aged Accounts.. Yes It Is Ok
Explain why when I just payed off my mortgage that my FICO dropped according to my score alert
New Member
youngwidow
Posts: 4
Registered: ‎09-15-2012
Re: Closing Aged Accounts.. Yes It Is Ok
This was my mortgage. I paid it off. To me, that should have increased it. Also, it is impossible to keep a mortgage account open once it is paid off.
New Member
youngwidow
Posts: 4
Registered: ‎09-15-2012
Re: Closing Aged Accounts.. Yes It Is Ok
I have scorewatch. Totally crazy that paying off a mortgage would lower your score. The system is broken
Community Leader
Valued Contributor
DaveSignal
Posts: 2,111
Registered: ‎07-29-2011
Re: Closing Aged Accounts.. Yes It Is Ok

The opening post for this thread was a correct post about AAoA.  Your score dropped when you paid off the mortgage because there is also a FICO scoring area for "types of credit" and you lost a major type of credit in your mix of accounts by closing the mortgage account.   Nobody said that FICO seemed like a reasonable scoring method.  It's not broken, this is just how FICO works.  I think some of the reasons my score fluctuates are crazy too, but it is what it is and this what the lenders use.  

EX:694 TU:744 EQ:777
Amex ED $19.5k - BoA Travel Rewards $15k - CSP $5k - SDFCU EMV $15k - NFCU goRewards $20k - Barclays Arrival $6.5k
Moderator Emeritus
llecs
Posts: 32,869
Registered: ‎08-04-2007
Re: Closing Aged Accounts.. Yes It Is Ok

youngwidow wrote:
Explain why when I just payed off my mortgage that my FICO dropped according to my score alert

The only FICO product that offers a score alert is ScoreWatch. Is this were you saw the alert? If so, take the score alerts with a grain of salt. Any score change is a net change of one or many factors that changed the score. If it dropped, there could be other things that factored into the score change like balance increases, utililization changes, whether or not other accounts were added or removed, and so on. If you have other loans reporting, a change to $0 wouldn't likely do anything at all to your EQ FICO. Converely, you don't loose points for adding a $500k mortgage as an example (other than the new acct ding). Paying it off wouldn't do anything either.

New Member
youngwidow
Posts: 4
Registered: ‎09-15-2012
Re: Closing Aged Accounts.. Yes It Is Ok

I have scorewatch. Still it makes no sense because how can a paid off mortgage account ever be kept open?? I had a conventional mortgage? It would stand to reason that paying it off would raise your score.

New Member
CultivatingCredit
Posts: 6
Registered: ‎09-28-2012
Re: Closing Aged Accounts.. Yes It Is Ok

I am getting the picture of this thread. Longer the accounts the better, drop off after 10 years once closed, and continue to count toward your average length EVEN after closed. I am still new to much of this an my oldest is only 3 years. Simple question but if I leave cards open those aren't taken off after 10 right?

 

D

Moderator Emeritus
llecs
Posts: 32,869
Registered: ‎08-04-2007
Re: Closing Aged Accounts.. Yes It Is Ok

CultivatingCredit wrote:

I am getting the picture of this thread. Longer the accounts the better, drop off after 10 years once closed, and continue to count toward your average length EVEN after closed. I am still new to much of this an my oldest is only 3 years. Simple question but if I leave cards open those aren't taken off after 10 right?

 

D


Right. It's not uncommon for those with older mortgages to have a length of credit history of 20-30-40 years.

New Member
CultivatingCredit
Posts: 6
Registered: ‎09-28-2012
Re: Closing Aged Accounts.. Yes It Is Ok
CultivatingCredit wrote:

I am getting the picture of this thread. Longer the accounts the better, drop off after 10 years once closed, and continue to count toward your average length EVEN after closed. I am still new to much of this an my oldest is only 3 years. Simple question but if I leave cards open those aren't taken off after 10 right?

 

D


Right. It's not uncommon for those with older mortgages to have a length of credit history of 20-30-40 years.

 


 

Not just mortgages but revolving credit cards?