How does AAoA exactly affect FICO?

[Green456]

I know that AAoA accounts for 10% of your credit score but can someone explain to me the breakdown by actual number of years?
1) Is 30 year AAoA giving the same score boost as 20 year AAoA
2) what is the minimum AAoA to get approved for mortgage?
3) what is the minimum AAoA to get approved for a premium credit card vs basic non premium credit card?

[Anonymous]

First off no one except the designers can tell you exactly the effect of average age on FICO, not to mention it probably varies by algorithm.

I believe the common knowledge is you receive small awards at year or half year breakpoints approximately between two years and eight years.

1. Some believe an average age beyond eight years does not offer any further benefit.

2. There is no minimum again AAOA for a mortgage.

3. There is no minimum AAOA to get approved for a credit card. However you cannot get a FICO score until you have six months of history.

Lenders look at your score and your DTI, your income and more. If there’s a manual review then they may look at the individual factors. Credit cards are typically reviewed by a computer, whereas mortgages have manual review. Obviously the higher your average age the higher your score but it’s really a small factor.

[Trudy]

You may already know, but AAoA is not 10% of your credit score.  It's Credit History Length which also includes AoYA and AoOA.  My age of oldest account (AoOA) was 22Y3M and AAoA was 12Y4M when I opened a new account in 8/2018.  One of the reasons my score decreased was AoYA resetting to zero.  This dropped my AAoA to 11Y2M.  So my understanding is all of the credit age factors make up 10% as all of these are listed on MyFico's 3B credit report under Credit History Length.  A flurry of new accounts can drop your AAoA and could result in points loss but as you know your oldest acct never changes unless it drops off of your report.  There are some who seem to know the threshold of AAoA where additional years may not matter outside of a manual review.  But AAoA keeps changing, up or down depending on whether you garden or open new accounts or accounts fall off your report.

[jamie123]

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@Green456 wrote:
I know that AAoA accounts for 10% of your credit score but can someone explain to me the breakdown by actual number of years?
1) Is 30 year AAoA giving the same score boost as 20 year AAoA
2) what is the minimum AAoA to get approved for mortgage?
3) what is the minimum AAoA to get approved for a premium credit card vs basic non premium credit card?

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1) Is 30 year AAoA giving the same score boost as 20 year AAoA?  After 8 years there is very little point gain as other posters have already mentioned.

2) what is the minimum AAoA to get approved for mortgage?  There isn't a minimum AAoA requirement for a mortgage but a lender will probably want to see at least 2 years and more probably 4 years of credit history before approving a mortgage. This would vary by lender.

3) what is the minimum AAoA to get approved for a premium credit card vs basic non premium credit card?  Most lenders like to see that you have at least 1 years history managing at least 2 credit cards before approving you for one of their premium cards. This is however not a hard and fast rule and some people can get premium cards from the get go.

[Anonymous]

Plus one to the above except I believe AoYA is included in the new credit section of the FICO pie if I’m not wrong?

[Trudy]

I believe you're correct Birdman7.  However, AoYA impacts AAoA which ultimately impacts Length Of Credit history as I understand it. I do now realize the OP noted 10% for AAoA which is the % for new credit.

[Anonymous]

But it doesn’t impact it anymore than any other account, hence the name average. 😉

[Anonymous]

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@jamie123 wrote:

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1) Is 30 year AAoA giving the same score boost as 20 year AAoA?  After 8 years there is very little point gain as other posters have already mentioned.

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Possibly no point gain at all above 8 years.  I'm not sure I've heard of any references from individuals claiming that they've found an AAoA threshold above 8 years, but who knows for sure as it's one of the more difficult factors to nail down data point wise.