topic AAoA vs Utilization in Understanding FICO® Scoring

AAoA vs Utilization

Anonymous — Thu, 10 Sep 2015 23:30:43 GMT

My dad put me on one of his cards (AU) when I was younger in order to build credit. He's fully drawn the card for business reasons and I have a mortgage app coming up. What do you guys think the score impact would be from dropping that card (deleting it from my record)?

AAOA would drop from 56mo to 31mo.

Oldest account would drop from 106mo to 34mo

Overall utilization would drop from ~58% to ~2.6-5.5% (depending on when the report is run)

Highest util would drop from ~97% to ~2.8-5.5%

# of accounts from 3 to 2

Avail revolving credit from 64.2k to 27k

The 97% util card also used to have a higher limit, so the highest $ amount drawn is ~132% of the current availability.

Thanks everyone

Re: AAoA vs Utilization

CH-7-Mission-Accomplished — Thu, 10 Sep 2015 23:47:33 GMT

Dump that card!

You may get to keep the account on your credit report. It will zero out the balance and show the account relationship as terminated. You would get to keep the average age of accounts. It just depends on the lender and if they delete or just update status. Ether way, get rid of it.

Re: AAoA vs Utilization

Anonymous — Thu, 10 Sep 2015 23:55:18 GMT

Thanks, I'm definitely dumping the card. Was curious if anyone could estimate the point impact from such a move though?

Unfortunately i don't think i'll be able to keep the account's age (apparently experian has some problem with zeroing it out) so I'll have to delete it and the history.

Still, i thought the impact would be positive and would be curious to hear if anyone could estimate the point improvement? (I'm using myfico reports so have the score presently)

Re: AAoA vs Utilization

CH-7-Mission-Accomplished — Fri, 11 Sep 2015 00:12:57 GMT

Please don't blow this. You have your dad contact the original creditor and tell them to remove you as an authorized user. The original creditor will update the account to show terminated and a zero balance (it is not Experian's call unless you are doing it through a dispute with them).

I have four terminated AU accounts from my ex. They are 20 - 30 year old accounts. They are all still on my reports and factor into my accounts age. They are from Cap 1, Chase, AMEX and Diners.

Please don't shoot yourself in the foot!

Re: AAoA vs Utilization

Thomas_Thumb — Fri, 11 Sep 2015 00:19:05 GMT

@Anonymous wrote:
My dad put me on one of his cards (AU) when I was younger in order to build credit. He's fully drawn the card for business reasons and I have a mortgage app coming up. What do you guys think the score impact would be from dropping that card (deleting it from my record)?

AAOA would drop from 56mo to 31mo.
Oldest account would drop from 106mo to 34mo

Overall utilization would drop from ~58% to ~2.6-5.5% (depending on when the report is run)
Highest util would drop from ~97% to ~2.8-5.5%

# of accounts from 3 to 2

Avail revolving credit from 64.2k to 27k

The 97% util card also used to have a higher limit, so the highest $ amount drawn is ~132% of the current availability.

Thanks everyone

Your individual AAoA is still above 2 years which is good. Dropping from 4 years to 2 years on AAoA is not a major impact. Getting that aggregate utilization down and eliminating the "max out" card should more than offset the loss in AAoA. Probably best to only post a balance on one of your two cards going forward - until after the mortgage anyway. Down the road, get a 3rd card on your own.

If you can maintain your aggregate utilization bewteen 1% and 6% after dropping AU status, that would be great. Unfortunately, since the AU card is active, I suspect you will have a problem getting the benefit of the account age by itself. It may need to be removed from your file so you don't take the utilization hit. However, it would be best to investigate options on removal.