FICO's average age of accounts includes open and closed accounts.
The Vantage 3.0 formula, published by Credit Karma among others, only includes the ages of open accounts.
I just took a huge hit in Vantage 3.0 because my American Express JetBlue card, which was backdated to 1988, was
converted to the Barclay JetBlue mastercard which was not. The average age of accounts dropped from 4 1/2 years
to 2 1/2 years.
@SouthJamaica wrote:FICO's average age of accounts includes open and closed accounts.
The Vantage 3.0 formula, published by Credit Karma among others, only includes the ages of open accounts.
I just took a huge hit in Vantage 3.0 because my American Express JetBlue card, which was backdated to 1988, was
converted to the Barclay JetBlue mastercard which was not. The average age of accounts dropped from 4 1/2 years
to 2 1/2 years.
Guess this bears repeating, CK had Open Accounts published before they switched to Vantage Score.
Credit.com also peddles Vantage 3.0 but uses AAOA correctly.
Doesn't mean anything with respect to how VS calculates age. I'm not sure what you're getting at in that losing 25ish years on an open tradeline would be a penalty on FICO as well?
http://your.vantagescore.com/resource/46
Here age my current average account ages as reported by Credit Karma (TU & EQ), Credit Sesame (TU) and Credit.com (EX). The primary scores on CK and CS are VS3. The primary score on Credit.com is EX National Equivalency. Both CK and CS are based on open accounts only. Credit.com is all accounts.
Still looking for a definitive document to clarify average age used for VS3. Anyone have an average age listed for VS3 on a report purchased through a CRA?
@Revelate wrote:
@SouthJamaica wrote:FICO's average age of accounts includes open and closed accounts.
The Vantage 3.0 formula, published by Credit Karma among others, only includes the ages of open accounts.
I just took a huge hit in Vantage 3.0 because my American Express JetBlue card, which was backdated to 1988, was
converted to the Barclay JetBlue mastercard which was not. The average age of accounts dropped from 4 1/2 years
to 2 1/2 years.
Guess this bears repeating, CK had Open Accounts published before they switched to Vantage Score.
Credit.com also peddles Vantage 3.0 but uses AAOA correctly.
Doesn't mean anything with respect to how VS calculates age. I'm not sure what you're getting at in that losing 25ish years on an open tradeline would be a penalty on FICO as well?
http://your.vantagescore.com/resource/46
What I'm getting at is that FICO factors in closed accounts as well as open accounts in calculating AAoA, so there was no change at all to my FICO AAoA, while there was a huge change to the Vantage 3.0 AAoA
@iv wrote:
@SouthJamaica wrote:
@Revelate wrote:
@SouthJamaica wrote:FICO's average age of accounts includes open and closed accounts.
The Vantage 3.0 formula, published by Credit Karma among others, only includes the ages of open accounts.
I just took a huge hit in Vantage 3.0 because my American Express JetBlue card, which was backdated to 1988, was
converted to the Barclay JetBlue mastercard which was not. The average age of accounts dropped from 4 1/2 years
to 2 1/2 years.
Guess this bears repeating, CK had Open Accounts published before they switched to Vantage Score.
Credit.com also peddles Vantage 3.0 but uses AAOA correctly.
Doesn't mean anything with respect to how VS calculates age. I'm not sure what you're getting at in that losing 25ish years on an open tradeline would be a penalty on FICO as well?
http://your.vantagescore.com/resource/46
What I'm getting at is that FICO factors in closed accounts as well as open accounts in calculating AAoA, so there was no change at all to my FICO AAoA, while there was a huge change to the Vantage 3.0 AAoA
VantageScore seems very clear on the subject:
http://your.vantagescore.com/resource/81
Myth: When you close a credit card or pay off a loan, you lose the value of the account's age in your credit scores
Fact: As long as an account is on your credit reports it is considered by credit scoring systems, open or closed and with or without a balance. As such, if you were to close a credit card that was opened 10 years ago it would still be seen and measured as a 10 year old account. And, closed accounts continue to age so an account that was closed 3 years ago is 3 years older today. As such, closing accounts will not result in a reduction in your credit scores as a result of the loss of the value of the account’s age.
So I guess that's proof positive that Credit Karma is doing something wrong in computing Vantage 3.0 scores.
@iv wrote:
@SouthJamaica wrote:
@iv wrote:
VantageScore seems very clear on the subject: http://your.vantagescore.com/resource/81
Myth: When you close a credit card or pay off a loan, you lose the value of the account's age in your credit scores
Fact: As long as an account is on your credit reports it is considered by credit scoring systems, open or closed and with or without a balance. As such, if you were to close a credit card that was opened 10 years ago it would still be seen and measured as a 10 year old account. And, closed accounts continue to age so an account that was closed 3 years ago is 3 years older today. As such, closing accounts will not result in a reduction in your credit scores as a result of the loss of the value of the account’s age.So I guess that's proof positive that Credit Karma is doing something wrong in computing Vantage 3.0 scores.
Well, no. Not quite.
CK doesn't compute scores. The VS3 from CK is calculated the same way any VS3 from TU or EQ is.
What CK does do wrong is in their "informational display" beyond the base report and score.
That's where they incorrectly display the Average Age of OPEN Accounts, where all major scoring models (including the VS3 they provide) use both open and closed accounts.
But they've been displaying it that way since before they included VS3. Or even VS2. Back when it was just TU NAS....
The important thing to remember here, is that ANY informational presentation, by ANY monitoring/pulling service, beyond the facts of the report, score number, and reason codes... is not actually part of the scoring process.
In some cases it may match scoring criteria (% utilization is frequently, although not always correct); while in other cases it is totally off the wall (like CK's "Total Accounts" section).
Well then I guess it's a coincidence that my FICO scores all went up 25-30 points, while my Vantage 3.0 score went down one point.
@iv wrote:
@SouthJamaica wrote:What I'm getting at is that FICO factors in closed accounts as well as open accounts in calculating AAoA, so there was no change at all to my FICO AAoA, while there was a huge change to the Vantage 3.0 AAoA
VantageScore seems very clear on the subject:
http://your.vantagescore.com/resource/81
Myth: When you close a credit card or pay off a loan, you lose the value of the account's age in your credit scores
Fact: As long as an account is on your credit reports it is considered by credit scoring systems, open or closed and with or without a balance. As such, if you were to close a credit card that was opened 10 years ago it would still be seen and measured as a 10 year old account. And, closed accounts continue to age so an account that was closed 3 years ago is 3 years older today. As such, closing accounts will not result in a reduction in your credit scores as a result of the loss of the value of the account’s age.
IV - Thanks for the link
Revelate - This statement is quite definitive on the AAoA method used by VS. Guess I was being a doubting Thomas
It is worth noting that in addition to VS and Fico weighing factors differently with their respective models each model uses scorecards. The scorecards add another layer of factor weighting. See illustration below for dirty/clean. The differentiations in factor weighting among clean scorecards likely include # cards reporting (I know my profile shows minimal response on this one), individual card UT % (again I see minimal response) and # inquiries. I'm sure other factors are weighed differently as well.
CGID - One point of interest below is no weighting on the "clean" example for months since past 30+ days past due. I realize this is a fictitious illustration (dirty scorecards do look at utilization). Nonetheless, It makes me wonder if any clean scorecards allow for 30 day lates and if so, how mild delinquencies are defined/segmented. What else would be considered a mild delinquency - collections less than $100?
