topic Re: AAoA effect on score. in Understanding FICO® Scoring

AAoA effect on score.

StarraeAday1 — Fri, 15 Jan 2010 03:02:20 GMT

It looks like my AAoA on EQ should move up to 5 years in May of this year if I leave things the way they are. Do you think that would give me a score boost? Just wondering if anyone had any idea. Thanks!

Re: AAoA effect on score.

Anonymous — Fri, 15 Jan 2010 19:16:46 GMT

It can't hurt

The magic AAoA number starts at 6 years (bottom side of High Achiever average).

Re: AAoA effect on score.

StarraeAday1 — Fri, 15 Jan 2010 20:06:00 GMT

Thanks, John! You're always so helpful.

Re: AAoA effect on score.

cashcardscore — Fri, 15 Jan 2010 20:39:52 GMT

I doubt your scores will go up when you AAoA hits 5 years. Mine did that on 1 Jan and my score dropped. I pulled EQ on 31 Dec and it was 727 and then on 1 Jan it was down to 715. Nothing on my report changed too.

Re: AAoA effect on score.

Anonymous — Fri, 15 Jan 2010 21:03:18 GMT

Is AAoA the average of open accounts or the average of all accounts?

Re: AAoA effect on score.

StarraeAday1 — Fri, 15 Jan 2010 22:16:55 GMT

It's the average age of any account, open or closed, showing on your credit report.

Re: AAoA effect on score.

Anonymous — Fri, 15 Jan 2010 23:31:17 GMT

@Anonymous wrote:
Is AAoA the average of open accounts or the average of all accounts?

Your AAoA is the sum of the ages of every account on your report, whether open or closed, calculated in months, divided by the number of accounts and then divided by 12. This is measured from the time each account was opened until present.

Re: AAoA effect on score.

Anonymous — Fri, 15 Jan 2010 23:47:16 GMT

So if you close an account that is almost 5 years old, the only affect on your score would be lowering your available credit, which affects your util?

Re: AAoA effect on score.

RobertEG — Sat, 16 Jan 2010 01:47:39 GMT

I estimate less than 3-5 points max increase per year based on AAoA, and that is optimistic.

Fair Isaac has never disclosed the specific yearly relationship between AAoA and scoring, so no one can give you an accurate prediction. But is it small.

Re: AAoA effect on score.

Jazzzy — Sat, 16 Jan 2010 01:55:27 GMT

@Anonymous wrote:
So if you close an account that is almost 5 years old, the only affect on your score would be lowering your available credit, which affects your util?

That's correct (assuming it's not your only revolving credit). The closed account will continue to report for you for up to 10 years.

Re: AAoA effect on score.

RobertEG — Sat, 16 Jan 2010 02:29:49 GMT

Also be aware that the supposed 10-year drop of date is not a rule at all, and it is up to the CRA, and in my experience, it is rarely done.

This is not regulated under the FCRA. Accounts can remain forever. For example, I still have an account reporting in my CR 30-years after closing.

How would anyone ever get a high AAoA if the CRAs routinely dropped closed accounts after 10 years? That would hurt a lot of consumers.

I speculate the CRAs probably have a policy of retaining accounts for at least 10 years after closing in order to make sure that any further routine issues raised under the FCRA can be responded to. For example the normal reporting drop off dates set forth in FCRA 605(a) range from 7 to 10 years.

However, even this is not absolute. FCRA 605(b) provides total exemption of the drop of dates set forth in FCRA 605(a), and thus permits the reporting of prior account derogs forever whenever the consumer makes application for credit in the amount of $150,000 or above. Debt never goes away, so it is additionally possible for an OC or CA to sue you after, for example, 15 years on an old debt. Sure, you may invoke your state SOL law to contest it, but the debt does not ever go away. If SOL is not invoked, only CRA data may remain as the only prima facie evidence upon which to base a judgment.

All I am saying is that CRAs dont usually drop at 10 years, and there are many good reasons, of which they are fully aware, where it might not be in the interest of creditors or consumers to do this.

Re: AAoA effect on score.

Anonymous — Sat, 16 Jan 2010 03:17:12 GMT

@RobertEG wrote:
Also be aware that the supposed 10-year drop of date is not a rule at all, and it is up to the CRA, and in my experience, it is rarely done.
This is not regulated under the FCRA. Accounts can remain forever. For example, I still have an account reporting in my CR 30-years after closing.
How would anyone ever get a high AAoA if the CRAs routinely dropped closed accounts after 10 years? That would hurt a lot of consumers.

I speculate the CRAs probably have a policy of retaining accounts for at least 10 years after closing in order to make sure that any further routine issues raised under the FCRA can be responded to. For example the normal reporting drop off dates set forth in FCRA 605(a) range from 7 to 10 years.
However, even this is not absolute. FCRA 605(b) provides total exemption of the drop of dates set forth in FCRA 605(a), and thus permits the reporting of prior account derogs forever whenever the consumer makes application for credit in the amount of $150,000 or above. Debt never goes away, so it is additionally possible for an OC or CA to sue you after, for example, 15 years on an old debt. Sure, you may invoke your state SOL law to contest it, but the debt does not ever go away. If SOL is not invoked, only CRA data may remain as the only prima facie evidence upon which to base a judgment.

All I am saying is that CRAs dont usually drop at 10 years, and there are many good reasons, of which they are fully aware, where it might not be in the interest of creditors or consumers to do this.

I respect your knowledge Robert BUT in my entire credit history which goes back decades I've only had ONE account that remained 10 years after closing. I may be an exception to the rule but that is my personal experience.

That's all I'm going to say on the matter.

Until you once again state that CRAs dont usually drop at 10 years and then I have to give my opinion.

Re: AAoA effect on score.

Anonymous — Sat, 16 Jan 2010 03:21:26 GMT

All of my old accounts have dropped at the 10 year mark on all three bureaus.

Re: AAoA effect on score.

Jazzzy — Sat, 16 Jan 2010 15:30:55 GMT

@Anonymous wrote:
All of my old accounts have dropped at the 10 year mark on all three bureaus.

That has been my experience as well. My next account that may drop is a 1989 account that will have been closed 10 years in March of this year. TU doesn't have it, but EQ and EX do. I've had so many new grad school loan accounts the past couple of years that my AAoA has dropped. I hate to lose this old one.

I will be thrilled if it doesn't drop...but...very likely...it will.

Re: AAoA effect on score.

manyquestions — Sun, 24 Jan 2010 19:00:25 GMT

I noticed on my own reports that it makes a big difference if my average age of accounts is 6 years or greater. Six years appears to be a big milestone. Or maybe I get rebucketed when I cross back and forth over that six year AAOA boundary. Are there any other known Fico AAOA tipping points? Does it pay to have more than 6 years AAOA?

Re: AAoA effect on score.

Anonymous — Mon, 25 Jan 2010 20:25:54 GMT

And on the flip side of the coin certain CRA's will routinely drop closed accounts long before the 10 years has elapsed. If that happens there is nothing you can do to get the TL back on your CBR.

Re: AAoA effect on score.

Anonymous — Mon, 25 Jan 2010 20:28:16 GMT

@manyquestions wrote:
I noticed on my own reports that it makes a big difference if my average age of accounts is 6 years or greater. Six years appears to be a big milestone. Or maybe I get rebucketed when I cross back and forth over that six year AAOA boundary. Are there any other known Fico AAOA tipping points? Does it pay to have more than 6 years AAOA?

Yes, although it may be difficult to do!

Re: AAoA effect on score.

hyprble — Mon, 01 Feb 2010 21:44:37 GMT

I have an AAoA of 7.39 years (oldest card opened in 98). Sadly, I closed a bunch of unused accounts almost 10 years ago not being aware that this would affect my credit score. I have at least 4 of those old cards dropping off my credit report this year taking me down to 6.95yr average. Do you think this will greatly affect my FICO?

Re: AAoA effect on score.

Anonymous — Thu, 04 Feb 2010 21:52:02 GMT

Struggling with this: Should I NOT try to delete (via a PFD) an "old minor baddie" because its oldness may be more useful to AAoA than its badness is bad?

My main scoring issue is lack of use of credit, mixed with a couple small dumb bills that seem to have gotten lost in the shuffle of my sometimes disorganized life and show up as lates/no pays. So I have had no good credit, and then a couple of dings which took me from a "no score" flatline to "bad score". Just within the last year, I got a secured credit card and have been using it at the low end of the "credit limit" in hopes it would help my score, and it really seems to have helped.

My "average age" of accounts is estimated in the comments as 4 years, but the only accounts listed that would be contributing to this "average" are my one less than one year old new "goodie" (my new secured card) and an 8 year old $75 baddie (a never paid over 120 days ultility bill from another state that apparently never found me when I moved, or maybe just an error, the account is not current). If I were able to get a PFD for the older baddie, and it goes away, then the only "account" I've got is my new one which is right now less than a year old.

Which is worse for my score: Knocking my AAoA down to less than a year, or NOT knocking out a $75.00 120days+late/no pay from 6-7 years ago off the report?

Or, are the comments based on a formula that is not sensitive to bad vs. good? Can old not-so-bad actually be helpful in establishing a better AAoA??

I'm just worried about knocking the AAoA down to less than a year if I get the old baddie removed with a PFD. I have just gotten myself out of "bad" and into "not good" range with the secured card and don't want to go backwards.

Any thoughts?

Re: AAoA effect on score.

smallfry — Thu, 04 Feb 2010 23:06:22 GMT

Clean reports are always best in the long run.