topic Re: AAoA in Credit Cards

AAoA

FutureBillionaire — Mon, 11 Mar 2013 14:53:42 GMT

What is a good AAoA in your opinion? What is a bad one?

Re: AAoA

Gunnar419 — Mon, 11 Mar 2013 15:12:57 GMT

I'm thinking that's very much a YMMV question.

I know that, to FICO, a AAoA between 6 and 12 years is considered golden. But there are plenty of young people just starting out who can't even dream of such age.

So if you're 40 or 50 and you don't have an AAoA that's up there, that might be "bad." But if you're 22 and you have an AAoA of 4 years. or even 2 years, that might be great.

What FICO says in its mysterious algorithm is one thing. But if I were a human doing a review of someone's credit, I'd look less for absolute AAoA than, "Is this person's credit well planned and stable?" or "Is this person opening new accounts (and thereby shortening AAoA) just for the hell of it?"

Re: AAoA

jamesdwi — Mon, 11 Mar 2013 15:32:09 GMT

I have a great AAoA for a 12 year old

Re: AAoA

Anonymous — Mon, 11 Mar 2013 15:33:57 GMT

@Gunnar419 wrote:
I'm thinking that's very much a YMMV question.

I know that, to FICO, a AAoA between 6 and 12 years is considered golden. But there are plenty of young people just starting out who can't even dream of such age.

So if you're 40 or 50 and you don't have an AAoA that's up there, that might be "bad." But if you're 22 and you have an AAoA of 4 years. or even 2 years, that might be great.

What FICO says in its mysterious algorithm is one thing. But if I were a human doing a review of someone's credit, I'd look less for absolute AAoA than, "Is this person's credit well planned and stable?" or "Is this person opening new accounts (and thereby shortening AAoA) just for the hell of it?"

Damn! You found me out!

Re: AAoA

webhopper — Mon, 11 Mar 2013 15:36:12 GMT

I'm still young (31 yrs old) so my personal goal is to keep my AAoA above 6. Right now its at 5.5, so I won't be applying for any new credit until that AAoA increases.

I think your AAoA stops being a negative factor once you get up to 6 yrs. Less than 1 year is really bad... between 3-4 years is not terrible. 6 and up is awesomeland.

Re: AAoA

FutureBillionaire — Mon, 11 Mar 2013 15:49:58 GMT

I'm at a bit over 4 years. I think I have been for a while. I could get another Amex if I cared about it. I don't, though.

I have about 5-7 inquires per bureau. My plan is to stay around that number. I won't apply for new cards unless I am getting fantastic signup bonuses/rewards.

Re: AAoA

thom02099 — Mon, 11 Mar 2013 16:36:13 GMT

In addition to AAofA, your oldest account also is a contributor. Hence the importance of AMEX backdating, particularly for those of us with "old" accounts (some older than some of the members here, LOL!). Having older AMEX accounts, and getting new ones with that backdating certainly contributes to increasing that AAofA. Wish more CCC would offer backdating...

Re: AAoA

Revelate — Mon, 11 Mar 2013 16:37:51 GMT

Think the model suffers extremely diminishing returns around the 4-5 year mark; I'd say anything over 5 is good.

Re: AAoA

L0RDAVENTAD0R — Mon, 11 Mar 2013 16:42:18 GMT

Mine is almost at 3 years (2 years & 11 months to be technical) & I'm 22. I can't even imagine having an AAoA of 12 years ! I need to let time do its thing.

Re: AAoA

Anonymous — Mon, 11 Mar 2013 17:48:51 GMT

@thom02099 wrote:
In addition to AAofA, your oldest account also is a contributor. Hence the importance of AMEX backdating, particularly for those of us with "old" accounts (some older than some of the members here, LOL!). Having older AMEX accounts, and getting new ones with that backdating certainly contributes to increasing that AAofA. Wish more CCC would offer backdating...

And I still don't get why Fico allow it, unless other issuers have a way to discount it when getting score or AAoA. My BCP now has a member since 1987 date.

I believe I got a gold Amex around 1987, and dropped it by 1989 (not worth the fee). I then picked up a Blue Sky in 2007, and converted to BCP in 2012.

In what way is this a consistent 26 year relationship, the great majority of that time I wasn't an Amex customer at all? Maybe I should contact Barclays, I had a chequing account (in the UK)with them from 1977 to about 1987, so surely they can backdate my Barclays Reward card back to then? (And when I think about it, I really did have the Barclaycard UK credit card in 1978, so a good case!)

Re: AAoA

Sevenfeet — Mon, 11 Mar 2013 18:41:47 GMT

There willl always be things that bring your AAoA down (buying a new car for example) but app sprees are the easiest way to send that metric into the depths. My AAoA before my app spree was 8 1/2 years. It's down to 6 1/2 now with three new cards listed but 2 new cards yet to report. I did get Amex to backdate my Platinum card from 1989 to 1988 to acknowledge the first Green card I got back then before switching to Gold in 1989. I don't think it's going to make a substanstive difference, but hey, I'll take it.

Re: AAoA

thom02099 — Mon, 11 Mar 2013 18:42:10 GMT

@Anonymous wrote:
@thom02099 wrote:
In addition to AAofA, your oldest account also is a contributor. Hence the importance of AMEX backdating, particularly for those of us with "old" accounts (some older than some of the members here, LOL!). Having older AMEX accounts, and getting new ones with that backdating certainly contributes to increasing that AAofA. Wish more CCC would offer backdating...
And I still don't get why Fico allow it, unless other issuers have a way to discount it when getting score or AAoA. My BCP now has a member since 1987 date.
I believe I got a gold Amex around 1987, and dropped it by 1989 (not worth the fee). I then picked up a Blue Sky in 2007, and converted to BCP in 2012.

In what way is this a consistent 26 year relationship, the great majority of that time I wasn't an Amex customer at all? Maybe I should contact Barclays, I had a chequing account (in the UK)with them from 1977 to about 1987, so surely they can backdate my Barclays Reward card back to then? (And when I think about it, I really did have the Barclaycard UK credit card in 1978, so a good case!)

Good points, it does make for an artificial AAofA. My first AMEX account was in 1976 but AMEX couldn't find it to backdate to then, just 1991. But as you said, I've actually spent more time NOT as an AMEX cardholder than as one! It looks good on the cards to have it backdated, and certainly does benefit us users...but is it accurate and correct?

Re: AAoA

Revelate — Mon, 11 Mar 2013 18:50:57 GMT

AAoA is a very small amount of the algorithm. Compared to other abuses which exist in the system, Amex backdating is fairly trivial.

Anyone with more than a passing familiarity of credit reports can spot a backdated account easily. This includes all lender underwriters: if it's a known quantity, it's easy to adjust for. I suspect if someone's on the bubble, sort of like AU accounts, the backdate may be "discounted" resulting in a denial, but that simply my own estimation of how lenders factor it in.

When there's people who can hit 740+ after two years of credit history, it's not like my boosting a 660 to a 665 or even 670 at a swag from an excellent backdate is a big deal.

Certainly I think anything which undermines the system in any way winds up as a disservice to the consumer, and Amex backdating may fall into ithat; however, it's not hurting baby kittens.

Re: AAoA

Anonymous — Mon, 11 Mar 2013 18:52:45 GMT

@ Revelate- I agree and I believe it is why banks like Chase do not consider AU in their underwriting.