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expected drop from new accounts

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Anonymous
Not applicable

expected drop from new accounts

Just wondering how much more of a drop I can expect. I had 1 paid off loan, 1 current loan, 1 cc reporting.

 

I went and got approved for 5 cc late August- mid September. The first 2 have started reporting. My AAoA dropped from 2.1-1.8 years. By my calculation I should stay above 1 year after the next 3 start to report. Since I have already had my drop from AoYA, the inq used to acquire the cards, and a decent drop when I went below 2 year AAoA, have I seen the most of my drop or can I still expect it to go down substantially more?

 

Since I will have 5 new cards reporting soon when can I expect to start to see the benefits?

 

And since one of the main things hurting my score was limited amount of positive reporting credit, will those benefits be much greater being 5 as opposed to just 1?

17 REPLIES 17
Brian_Earl_Spilner
Credit Mentor

Re: expected drop from new accounts

You maximized scoring when 3 started reporting. The other 3 left to report won't help in that aspect. They will only help if it brings your utilization below one of the thresholds. If you don't cross a threshold, you won't see a score boost. You'll have to wait until one of the scoring experts come in, for details, but until the accounts start aging to a year, you're really not going to see any benefits. I don't believe the more accounts you have reporting positively boost your score, but the more positive tradelines you have, generally the better you look to new lenders.

    
Message 2 of 18
Anonymous
Not applicable

Re: expected drop from new accounts

Alright. I was hoping because I've seen different things between 3 being ideal revolving and 5 being ideal number. One of the new ones is a charge card which is why I went for one extra cards, so if it is 5 revolving I would have that. 

 

And even if it is 3, I kind of thought that since the reports telling me one of the negatives was not enough positive lines, that having 5 might not be a threshold per se, but would benefit me by having more on time payments overall and possibly help cancel some lates from years ago. So like if I had 17 of my 60 car payments showing a 30 day late, that now having 7 current lines reporting on time would start to skew that on time percentage in my favor. 

 

Hopefully my score doesn't drop more as the others start to report as I said my AAoA shouldn't drop below a year. If that penalty has been hit already then I would think that my scores would start to slowly climb. Utilization won't be a factor. I'm under 8.9% now so once those report it'll go lower. So no threshold to cross there. Just waiting for positive payments and time. I'm at 680 fico EX now. My highest was 720 on EX. 

 

Don't plan on app'ing for anything else in the next year except a 2nd NFCU so mostly gardening now and working on GW for the lates on old car loan.

Message 3 of 18
Brian_Earl_Spilner
Credit Mentor

Re: expected drop from new accounts

If you have lates, then I think it'll help with upping that on time percentage. Thats why I did a spree when I first started rebuilding. More positives to offset the negatives. It's worked for me.

 

As for the 5 cards, that's a speculation to get to 850, but the truth is you can get to 850 with 1 card. Data points on new histories show that there are no more boosts after adding your 3rd revolver.

    
Message 4 of 18
Anonymous
Not applicable

Re: expected drop from new accounts

Assuming a non-thick file, the scoring benefit of having a handful of cards over just one isn't significant.  I've found the gain on average to be about 8 points.

 

As for there being no scoring benefit of 5 cards over 3 cards, that's not entirely accurate.  Equifax imposes the first scoring penalty at 33% of accounts with a balance.  If someone only has 3 open accounts and all 3 are revolvers, being at AZEO would be 33% of accounts with a balance and a small penalty (3-4 points perhaps) would be imposed.  With 4+ cards however, this would not happen.  This is only true of EQ, as EX and TU don't care about that 33% of accounts with balances point.

Message 5 of 18
Anonymous
Not applicable

Re: expected drop from new accounts

Cool thank you. I am not concerned with getting to 850. I would like to get to 760 and kind of hover there to get the best rates on loans. I am only 80 points away. Currently going to try and become an AU on an older card with perfect history and low utilization to try and age my file a bit. 

 

I know when I look at one of my reports it was only showing 4 lines of credit so it showed 25% of my lines showing a late. So now that'll drop to 12.5% at least showing a late.

 

 

Message 6 of 18
Anonymous
Not applicable

Re: expected drop from new accounts

Percentage of accounts showing a late isn't a FICO scoring factor.  When it comes to payment history, it's either perfect (clean) or it isn't.  If it isn't, you've got to try and work to clean it up. 

Message 7 of 18
Anonymous
Not applicable

Re: expected drop from new accounts


@Anonymous wrote:

Assuming a non-thick file, the scoring benefit of having a handful of cards over just one isn't significant.  I've found the gain on average to be about 8 points.

 

As for there being no scoring benefit of 5 cards over 3 cards, that's not entirely accurate.  Equifax imposes the first scoring penalty at 33% of accounts with a balance.  If someone only has 3 open accounts and all 3 are revolvers, being at AZEO would be 33% of accounts with a balance and a small penalty (3-4 points perhaps) would be imposed.  With 4+ cards however, this would not happen.  This is only true of EQ, as EX and TU don't care about that 33% of accounts with balances point.


I do plan on implimenting the AZEO method. Right now only 3 revolvers reporting but all 3 have small balances. Now all 3 of those are zero so next reporting will show zero. Of the remaining 3 that haven't started reporting, only one will be showing a balance. So I started tracking all of this to see the impacts of everything.

 

Totally seperate note, I applied for an Uber card last Tuesday and it was reporting on my EX on Friday and EQ on Monday. Of the 5 cards I got approved for, that was the last and the 2nd to report. 

Message 8 of 18
Anonymous
Not applicable

Re: expected drop from new accounts


@Anonymous wrote:

Percentage of accounts showing a late isn't a FICO scoring factor.  When it comes to payment history, it's either perfect (clean) or it isn't.  If it isn't, you've got to try and work to clean it up. 


I knew I saw it on one of my reports. Might've been CK. 

 

Going to try your "saturation" method. But it was with Wells Fargo and I haven't seen many have success with them. So I'm not expecting much there. Btw, do you recommend that on saturation GW to request all lates to be removed(17 if 60 were 30 day) or GW them one at a time? Or just request maybe the last 2 years worth and wait for the early ones to age off?

Message 9 of 18
Anonymous
Not applicable

Re: expected drop from new accounts


@Anonymous

I knew I saw it on one of my reports. Might've been CK. 

 


What you actually saw was CK's summary page; you didn't see it on your actual reports.  CK is great for your actual reports, but absolute garbage for everything else... the top 2 things being their non-FICO (unmeaningful) scores and their front-end fluff summary page that provides all of their members with incorrect/ misleading information.  Almost all of their summary page factors aren't accurate.  For example:

1 - Percentage of payments you've made on time is irrelevant.  99% doesn't mean a better score than 80% for example.

2 - It's suggested that 0%-9% revolving utilization is ideal/equal, when 0% actually isn't good and results in a scoring penalty.

3 - Credit age is calculated using both open and closed accounts, but the summary page only shows your average of open accounts.

4 - Their color-coded suggested number of accounts ranges are BS.  Having 9 accounts on your CR isn't any "worse" for your score than having 14.  Having 16 isn't any "worse" than having 21, but their images would suggest otherwise.

5 - Having 0 inquiries is better than having 1-2 inquiries when it comes to scoring.  CK suggests that 0-2 is all equal.

Message 10 of 18
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