Potentially negatively affecting my score?

[Anonymous]

Hi all & forum experts out there!

First post here, after coming from the truecredit site and realizing that their reported "scoring" (more like FAKO scores) and having an embarassing score misunderstanding (basing my number off of truecredit's reported number, I realized my true FICO was quite a bit lower)...

Anyway, I'm on the path to increasing my score as best I can and have a question regarding a revolving credit account that I am named on.  I'd like to know if this would be a negative or positive in my total FICO.  Basically, this is an account I was named on from my parents when I left for college. 

Account: revolving credit
Limit: $30k

Bal: $4k

Payment History: Never late

My personal credit profile basically consists of:

1 Residential Home Mortgage ($200k)

1 Auto Load ($22k)

1 Amex CreditCard ($4500 limit, never late payment)

Let me know if you need other info is needed to help determine if I should remove the account from my credit profile or leave it on there!

Thanks!

[Anonymous]

Hi jamesfreddyc,

Welcome!

On AU cards (and assuming the card has a clean payment history), you always want to check what your AAofA, oldest account, and utilization are with and then without the card reporting.

So, what is your AAoA without the card reporting?  With the card reporting?

What is your oldest account with the card reporting?  Without the card reporting?

And what is your individual as well as overall utilization with and without the card?

That will help you determine if the card is likely helping or not.

[Anonymous]

Thank you for the reply!

Here's some more info in response to your post.

The card has never had a late payment.  Ever.  Since 1997 when I was named on it.

So, what is your AAoA without the card reporting?" --> 6.25

With the card reporting? --> 6.85

What is your oldest account with the card reporting?   --> 1997

Without the card reporting? --> 2000

And what is your individual as well as overall utilization with and without the card?  --> I did a search for "overall utilization" but could not find any definition.  Could you clarify what this is or explain how to arrive at this? 

Thanks again for your help!!!!

[Anonymous]

TTT  

[llecs]

Basically you have a card that is older than your AAoA and your oldest revolving and your oldest account overall. Removing it could likely hurt your FICO scores (assuming all 3 reports are the same). It all depends on the answer to your utilization question.

Utilization on a CC/LOC/some HELOCs is calculated by taking the balance and dividing it into the CL. What you'd want to do is add up ALL of your CC balances and add up ALL of your CLs and divide the overall balance into your overall CLs to create a percentage. Then redo it. Redo it without factoring in the CC in question. If that percentage dropped when you removed that one CC, then that means your folk's CC is a drain. If your overall util increased, well, it means it is helping.

[Anonymous]

llecs,

I appreciate the response and info!  Will get to work on determining the utilization --- anyone have an excel spreadsheet setup to be able to just punch in some numbers?    Holy cow -- this is gonna take some work! 

Thanks again for the info --- it's all very much appreciated!

james

[llecs]

I use Excel but it's easy to do...And the Amex is your only CC, right?

Balance------CL--------(balance/CL*100)

As an example (guessing your Amex reported balance).....

Amex             $100      $4500     2.22%

Folk's CC   $4000    $30000   13.33%

Overall       $4100     $34500    11.88%

I confess I didn't study your post as well as I should have but if your Amex is your only card, then adding your folk's CC will increase util by almost 10% overall. This will result in a loss in points. However, you are adding an account that will increase your AAoA and your length of history and that alone, IMO, will result in a net gain. On top of that, you are lacking per a mix of credit. Ideally, you'd benefit from 3 CCs, and adding another via your parents will improve that greatly.

I think you'll see a nice net gain (I'm guessing 20-30, though only a guess) if this is added. That's assuming the payment history on this card is spotless.If I'm wrong and you lose, you can always get it removed.

[Anonymous]

llecs,

You are the man/woman (whichever, it doesn't really matter!!!)...  Can't tell you how much I appreciate your input on this!  And yes, you pretty much have my info all down correct (Amex is only CC, but I just added a Wal-mart store CC, $500 limit, payed-off the bal from all purchases already).  I'll consider your advice and look into some other CC's if it'll help my credit profile.  Don't plan on being added to any more credit form the folks' (I am 39 yrs old now!) --- really, this whole thing started because I saw that CC account on my report and I was like, "what?  That isn't mine!".  So, upon calling the CC company, I figured out it was from my college days as a young'in!

Hey, again -- much appreciated for your efforts on this!