topic Account Age vs Damage From Account in Understanding FICO® Scoring

Account Age vs Damage From Account

Anonymous — Sat, 15 Aug 2020 02:35:57 GMT

Let's say your oldest account is 20 years old. Next oldest account is 9 years old. Let's say the credit file is not thick (adequate, but not thick). Active accounts include 4 credit cards - one less than a year old, one less than 2 years old, one 5 years old, and one 9 years old, an auto loan, tires loan, and 2 (unfortunately) Affirm loans...I didn't know until recently that they're bad for your credit. That's all that's currently open. Auto loan and tires loan still considered new.

Now let's say that oldest account, 20 years old, has a foreclosure.

Would the scores be better keeping the 20 year account or getting rid of the foreclosure account (if possible)?

Re: Account Age vs Damage From Account

AllZero — Sat, 15 Aug 2020 02:38:59 GMT

In general, you want to be on a clean score card. Any derogatory or delinquency will suppress your scores.

I would recommend reading the below from Birdman7

General Scoring Primer and Version 8 Master Thread rev.5.17.20

Re: Account Age vs Damage From Account

Anonymous — Sat, 15 Aug 2020 02:57:30 GMT

Wow. Thanks much for the info. Quick follow-up. What does segmentation factor really mean in this context?

Re: Account Age vs Damage From Account

AllZero — Sat, 15 Aug 2020 03:51:42 GMT

In general, it means get rid of the foreclosure account (if possible).

Re: Account Age vs Damage From Account

Anonymous — Sat, 15 Aug 2020 03:54:58 GMT

Oh, I got that part when it said oldest account was not a factor. Just wondered about what the rest meant then as far as what it is used for then and why sites, even MyFICO, make it look like it's a factor..

Re: Account Age vs Damage From Account

AllZero — Sat, 15 Aug 2020 04:45:33 GMT

Age of accounts, e.g. AAoA, AoOA, AoYRA, etc. are important factors. 9 year old account should be sufficient to get one into the 800s.

As noted in the link, see post 4, some are scoring factors, some are segmentation (score card reassignment) factors.

It's when one is reaching for 850s is when age factors is very important if thresholds are met. Same could be said with 800s, 760s, etc.

Re: Account Age vs Damage From Account

M_Smart007 — Sat, 15 Aug 2020 17:15:17 GMT

@AllZero wrote:
In general, it means get rid of the foreclosure account (if possible).

I would agree on getting rid of the foreclosure, even if that means getting rid of the account as a whole.

Re: Account Age vs Damage From Account

Anonymous — Sat, 15 Aug 2020 18:03:46 GMT

Thanks much for the feedback. Appreciate it!