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How long before the newness of an acct stops hurting one's credit score?
Posted on 2/16/18 at 3:13 pm
Posted on 2/16/18 at 3:13 pm
For example, I added two new credit cards in 2017. One of them now has 11 months of good payment history, the other one has 6 months.
Do they still hurt my score a bit?
Do they still hurt my score a bit?
1
Posted on 2/16/18 at 3:56 pm to cypressbrake3
quote:
Do they still hurt my score a bit?
Yes. In fact, at about 5 years, they will STILL hurt your score, albeit minimally.
And they drag the average age of accounts down, too. Why I really don't get the whole "churning" thing that people are doing.
Posted on 2/16/18 at 4:00 pm to S1C EM
quote:
Yes. In fact, at about 5 years, they will STILL hurt your score
You are referring to the average not the actual inquiry, correct? The inquiry will drop off at 2 years.
Posted on 2/16/18 at 5:04 pm to S1C EM
quote:
Yes, in fact, at about 5 years, they will STILL hurt your score, albeit minimally.
If a 5 year acct with a perfect payment history does anything OTHER than help one's score, then something is bad wrong with the scoring system, imo.
Posted on 2/17/18 at 9:58 am to cypressbrake3
Credit scores are a scam. They’re created to tell companies who will be a good lendee and make their payments to maximize the companies’ profit from interest and minimize their losses. So having accounts that last a long time benefits the companies, and you’ll get docked if your accounts aren’t long term benefits, even if the company doesn’t lose money on you
Posted on 2/17/18 at 10:13 am to LSU6262
quote:
You are referring to the average not the actual inquiry, correct? The inquiry will drop off at 2 years.
Correct. Yes, hard inquiries should drop at 24 months.
Posted on 2/17/18 at 10:21 am to cypressbrake3
quote:
If a 5 year acct with a perfect payment history does anything OTHER than help one's score, then something is bad wrong with the scoring system, imo.
I see I'm getting downvoted for saying it, but it's correct. Obviously, keeping up with your payments DOES help your score. In fact, having a good payment history is literally the most important factor to the score. The longer you continue to do this, it definitely increases the score. However, average age of accounts, while weighted very minimally, DOES negatively affect one's score the "younger" that age is.
The credit scoring system is a complete joke if we're being honest. It used to be that you had three scores, one from Equifax, Transunion, and Experian. Then they added in the FICO which was based on some algorithm that pulled info from those three. Then suddenly, there were more versions of the FICO, with different scores for different applicant types. Now you've got a different score that shows for mortgages, cars, credit cards, personal loans, student loans, insurance ratings, etc. And the thing is, NONE of them are or even have to be consistent. My wife has an "average age of accounts" that shows with one bureau as about 12 years, yet another bureau shows that same stat as 5 years. The 5 year one counts the "limited history" as a negative area, whereas the other shows it as a positive.
It's friggin' ridiculous.
Posted on 2/17/18 at 10:26 am to S1C EM
You’re getting downvotes because you are the oweo of money talk.
Posted on 2/17/18 at 10:29 am to 13SaintTiger
quote:
You’re getting downvotes because you are the oweo of money talk.
Okay, I don't have a clue what that means.
I'm guessing he's looked at about like OWS in the crypto thread.
I'm just answering a question because it's something I happen to have an above average level of experience with.
Posted on 2/17/18 at 10:44 am to S1C EM
Maybe this will be helpful?
How average account ages affect scores...
How average account ages affect scores...
quote:
To effectively manage the length of the credit history portion of your score so that you maximize the influence of low utilization and on-time payments, or, if necessary, minimize the effects of any high utilization or late payments, simply continue to:
*Raise your average age of accounts by refraining from opening any new accounts.
*Increase age of your oldest accounts and make their presence felt by keeping them open and active.
*Allow your most recently opened account to age by not adding any new ones.
This post was edited on 2/17/18 at 10:45 am
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