What is considered a thick credit history?

[killer_queen229]

March will be 3 years worth of credit 😀 And I make my payments on time. So what is considered a thick file?

[Anonymous]

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@killer_queen229 wrote:
March will be 3 years worth of credit 😀 And I make my payments on time. So what is considered a thick file?

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It all depends. Not only do the ages of your accounts determine a "thick" file but the credit limits factor in, too. 5 years of credit history and a $50k TCL could be considered a thick file. 10 years of credit history with $5k TCL wouldn't be considered a "thick" file exactly. In general 10-20 years should make a file "thick" taking into account that you have a decent CL. By decent, I mean $50k+.

[Anonymous]

Hi KQ.  The way I have seen the words used ("thick" and "thin") is chiefly to refer to the number of accounts in your profile (and secondarily to account age).  So an example of a thin profile is how most people start out.  At first they typically only have one account, like a credit card.  Their profile is thin, like a sandwich with only one very thin piece of ham on it.  But if over time their profile accumulates some more accounts (more ham, lettuce, turkey, swiss, etc.) it becomes thicker.

When a profile is extremely thin, there is not much to go on, and it may be so thin that FICO can't even give it a score.  (One credit card that is three months old.)  And even if it does have a score, a manual reviewer would be dubious because there's only one or two examples of how you have handled credit.  Thicker profiles involve many examples of credit.  Thicker is not synonymous with Good -- a person could have a ten year history with many accounts, some of which show that the consumer doesn't make payments on time.  Very thick profiles tend to more easily absorb impact from adding a new account, because the new account is only 1 account of several.

[Anonymous]

Specifically you lose 1/N of your AAoA when you open your Nth account. So if you are opening your 15th account losing 1/15th of your AAoA doesn't hurt much, just the inquiry penalty.

But your second account cuts your AAoA in half. That hurts! Hence the advice to get at least three accounts going early so that you are only getting hit for a quarter of your AAoA when you open the next.

[RobertEG]

The technical literature on credit scorecards uses the standard terminology of thin and thick to refer to the number of tradelines in the credit file.

The most common division typically used in the technical literature is the division of a thin file at less than 3 TLs.

Whether or not a scoring model uses only a thin-thick distinction or a sliding scale is clearly up to the developers, and there is no standard definition.

It is usually used in the mix of credit scoring category,  However, thin-thick can also be used in more than one scoring category, and is not always limited to mix of credit..  I have seen, for example, models that use a 3TL or more distinction of credit mix scorng, and yet also use thick vs thin to make sub-distinction branches withn new credt and other scoring categories, such as Util of Credit, where scoring of revolving % util can also vary depending upon whether the file is thick or thin overall.

I have never seen a specific public disclosure by Fair Isaac as to their dividing line(s) and how the scoring changes when lines are crossed.

However, the patent literature has an example of a patent obtained by a major \U.S. bank that uses a scorecard based on designation of the border as being 3 TLs..

[takeshi74]

Don't overlook other discussions as a resource.  This thread is on the first page of threads in this subforum as of my post:

http://ficoforums.myfico.com/t5/General-Credit-Topics/Thick-VS-Thin-profiles/td-p/4265585