FICO score i ncrease with CC util

[joeblow2]

used it last month after my CCL droped from $1400 to $500 on it that brought my total CCL to 29,700

[cobaltnv]

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@joeblow2 wrote:
1 more ? i have a gas CC XOM 20 yrs old $500 CCL   it survived my BK in 6/2001 how is this affecting my score ?  my next oldest card is 7 yrs old

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This card is helping a great deal by increasing your average age of accounts and your oldest account. Both of these are important aspects of the FIco score. I would do what ever you can to keep the gas card open--that is use it at least every two months or so. 

It is possible that your scores are being held back a bit by this card because it has you in a very old bucket where most have an AAoA of maybe 10 years or more. Don't get me wrong--you definitely want to keep this card open and active it is helping you, but it also may have something to do with you score reaching a plateau. Maybe the mods can comment on this? 

[joeblow2]

on my reports my avg account age still shows over 5 yrs why isn't this 20 yr old account being factored in . 2 mortgages 1st and 2nd and 7 other CC

[cobaltnv]

Why do you think the 20 y old is not being factored into you AAoA? Have you done out the calculation? 

Add up the number of months each account has been opened, sum them together, and divide by the number of accounts. All accounts open and closed are counted in this calculation (except for CA)

[joeblow2]

Another ?. What is better for increasing a FICO score a CC bal of $100 and paying $20 a month on it ($6000 CCL) also trying to maintain a constant bal <=$100 so a balance gets reported.  or a 3 or 4 year Auto loan with fixed payments or are they of equal weight to FICO scoring?

[Anonymous]

Maintaining low utilization and NO new credit will help your FICO score short term.  A new auto loan will probably initially hurt your score for the following reasons:

1.  New inquiry

2.  Increased debt

3.  New loan/credit (will improve as loan ages with timely payments)

4.  High loan balance to original loan amount ratio (your score will be negatively affected until you have paid approximately 35% of the loan off).

5.  Possible decrease in your AAoA

So, if you are considering a new Auto loan to help your score, it will probably NOT help your score short term.  It will be a positive down the road, once it is paid down/off, is aged and has a positive history.  But for the short term....FICO will take a hit.

NOTE:  For those with little or no credit or very thin credit, a new loan may help.  But for established credit file, new credit won't usually help initially.

Message Edited by txjohn on 03-19-2009 03:37 PM