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Any Credit Score Gurus Here?
Old 12-10-2016, 10:55 PM   #1
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Any Credit Score Gurus Here?

Recently I got a notice from BA that they were going to close my oldest cc unless there was activity on it before mid Dec. I was planning to comply and put a $2 type charge just to keep the oldest cc alive. Then I started wondering if it really mattered.

We have a lot of cc in the drawer unused. The utilization using all and a max charge month is about 0.02 (2%). Without this oldest card, that number goes up slightly to 0.022. That is using the balances at month end. If I have to include the balances in the new month before the previous month gets paid off,
I suppose those numbers could double.

This oldest card is from 1995. Without it, the oldest card is from 2000.
If I let the oldest card get cancelled, do you think there will be a significant reduction of credit score?
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Old 12-11-2016, 12:17 AM   #2
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I have no idea....

Why not go to Credit Karma and put in a what if and see....

I have read that the age of credit does matter.... but I would not know if 95 to 00 would move the needle any.... however, I would want to keep the 95 and drop the 00 if all else were the same...
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Old 12-11-2016, 05:42 AM   #3
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The amount of your credit that is available but unused is part of your credit score. I do not know how much your potential change would impact the actual score though.
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Old 12-11-2016, 10:35 AM   #4
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"We calculated your age of credit history by averaging the ages of your open credit accounts". I've 13 open accounts with an average age of 5 years, 8 months - thanks to scooping up card bonus money via opening lots of cards lately. Credit utilization is under 1%, payment history 100%, no derogatory remarks (your feet smell?). Those three things are shown as of high impact, age of history as medium impact on score.. My score is 818-820. That of any help on your question?
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Old 12-11-2016, 10:39 AM   #5
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Quote:
Originally Posted by kaneohe View Post
If I let the oldest card get cancelled, do you think there will be a significant reduction of credit score?
Probably not, and whatever reduction does happen will likely be reversed entirely over the next several months if you behave yourself (financially).
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Old 12-11-2016, 11:18 AM   #6
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I took a huge hit when I closed all but 1 card. All the way down to 770. Now my report states credit history too short, no mortgages, no loans. But I like having only 1 card and USAA has never turned me down
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Old 12-11-2016, 11:38 AM   #7
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We put our Ooma on our oldest card, $5 a month, to keep it alive. The oldest age does matter but I think that 20 years was the max. Because your next oldest was from 2000, it might impact you but I have been out of the biz for two years (and loving it) so the rules may have changed.
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Old 12-11-2016, 11:46 AM   #8
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I have a credit score of 820. It dropped from 824 with the opening of a Costco credit card as the average age of my cards changed with that event. I imagine that my oldest card, 20+ years old, being dropped would affect my credit score too. Especially since the 2nd oldest active card is only 9 years old. I only keep this older card for the credit report. I keep it as my emergency backup card and once a year I buy a tank of gas with it.

At most, your credit score would drop 10 points is my guess.
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Old 12-11-2016, 11:57 AM   #9
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I keep my oldest card for just this reason. Once a year I use it for a gas purchase (it also gives cash back on gas purchases) just to keep it active.

It's 10 years older than my next newest card... so worth keeping in the mix.
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Old 12-11-2016, 02:11 PM   #10
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We have 2 active CCs and our credit score has been >800 for as long as I have been aware (close to 10 years). If you pay off your balance monthly for a long time you are pretty well assured of a high score.
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Old 12-11-2016, 05:03 PM   #11
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I have no idea....

Why not go to Credit Karma and put in a what if and see....
This thread got me interested since I have no idea what my credit score is either and thought I might as well check, for the fun of it. Credit Karma's claim to get your credit score instantly is "misleading" (trying to be nice). I entered all the info as requested and "then they said" that I would need to send in two forms of identification (VIA US Mail) before they could supply me with my credit score. Never heard that on any of their BS commercials.

Maybe it's because other than CC's (which I pay off in full each month), I haven't bought anything on time in well over 20yrs now and don't intend to in the future. I don't really care enough to go thru that hassle so I guess I'll go on without knowing (nor do I really care)
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Old 12-11-2016, 05:19 PM   #12
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Not sure why some have low scores with dropping down to 1 card or even how soon it was open...

My DW has one card in her name... opened maybe 4 or 5 years ago... and her score is 825 to 830 which is just a bit higher than mine... heck, she has been higher than me for a few years.... mine had dipped to 770ish for awhile (do not know why)...

I have a long credit history and had a good salary when working... but I do carry the mortgage and the car note... plus almost all big charges goes on my CCs...
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Old 12-11-2016, 06:09 PM   #13
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I signed up with credit karma for their free tax return (coming soon). It was free. It showed me my score immediately.

The score they used seemed a bit higher than normal, but I have not looked at my score my CC report in a few months, so maybe it did go up 25 points.
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Old 12-11-2016, 06:13 PM   #14
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I have a credit score of 820. It dropped from 824 with the opening of a Costco credit card as the average age of my cards changed with that event. I imagine that my oldest card, 20+ years old, being dropped would affect my credit score too. Especially since the 2nd oldest active card is only 9 years old. I only keep this older card for the credit report. I keep it as my emergency backup card and once a year I buy a tank of gas with it.

At most, your credit score would drop 10 points is my guess.
Have you checked your credit report re:Costco credit card? My experience when a card is transferred to another bank is that the age history goes along with it. I just checked my latest CR and Citi Costco card has the same opening date as the original Amex Costco card. I would guess that the change you saw is just noise in the measurement and is not cause/effect of the Costco cc transition to Citi.
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Old 12-11-2016, 06:38 PM   #15
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"We calculated your age of credit history by averaging the ages of your open credit accounts". I've 13 open accounts with an average age of 5 years, 8 months - thanks to scooping up card bonus money via opening lots of cards lately. Credit utilization is under 1%, payment history 100%, no derogatory remarks (your feet smell?). Those three things are shown as of high impact, age of history as medium impact on score.. My score is 818-820. That of any help on your question?
Thanks to all for your comments and wisdom.

calmloki, thanks for your data. It's similar in my mind to my situation.
Avg age is now 6.5 and would go to 5.5 if the oldest one got closed. My credit utilization (depending on how you calculate it) is 2-3% on a big spend month
and might be 2.1-3.2% after oldest card closure. Payment history is clean.
Don't know real credit score but Discover reports it in the 805 region which seems to be consistent w/ yours but w/ a higher utilization which won't increase much w/ the cancellation of this card.

The other thing someone pointed out on another forum is : does it really make a difference if it goes down a bit since the good class comprises a range of scores. I guess my gut feeling is that it won't make a huge difference esp. if age is "only" a medium impact and utilization won't change a lot.

My wishy washy thought is that I'll buy that $1.49 pomegranate on the old card if I happen to be in the neighborhood but I won't make a special trip to do it.
Kind of interested to see what happens if I just let the card cancel since there are no plans to get a loan or anything............just scooping up cc bonuses like you.
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Old 12-12-2016, 02:23 AM   #16
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Former bank regulator here - credit scores vary according to lots of factors. It is only important if you are thinking of getting more credit, renting a property, getting insurance, having an employer check as part of its hiring process. Basically a score is a static representation of your creditworthiness, but also serves as a proxy for your level of responsibility.

A credit swing of 40 points isn't really a big deal. It can change based on whether you happened to charge a bit more one month, or if you have a lot of inquiries, or if you close an old credit card. It will right itself eventually. As long as it stays relatively high, shouldn't be an issue. The question that often comes up is what is high, and there is not a bright line test. Credit scores represent relative risk. A bank may change its risk appetite based on where the economy is headed, whether the lenders delinquencies are headed up, and so on. Scores above 700 are generally considered very good to excellent.

I always use all of my credit cards at least once a year. You can easily put $1 in Amazon credit and use the credit later. You can do that for all your cards once a year and then not worry about it until the next year.

A greater issue than credit cards is the negative impact for not having a good mix of credit. For instance, I keep my mortgage account open even if I can easily pay it off. What I did was to open an interest only mortgage and then pay it down so the current balance is only $41, which results in a monthly payment of a few cents. So it doesn't matter that it is a variable rate and I will have a paying mortgage for a thirty year period. That probably adds 20 to 40 points to my credit score. You easily do the same thing with a saving secured installment loan. Lenders usually charge very little for these types of accounts.

Hope that helps.
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Old 12-14-2016, 06:18 PM   #17
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I just discovered that Capital One offers some (all?) customers free and instant credit scores checks through "Credit Wise". Okay, so I checked and found it to be 801.

Why only 801?

I haven't bought anything on credit in well over 20 years (except CC's which I always payoff each month). I haven't applied for any new credit cards or any credit of any kind in many years, I own my own house and a sizable chunk of land, I pay cash for one or two new cars each year (and a couple of older ones from time to time ), millions in savings, never had a check bounce, never paid any bill late or missed a payment, etc, etc.

So how do you get the highest scores? Do I need to buy something on time to improve my score? (which I'm not going to do since I don't really care about a credit score that much anyway.)
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Old 12-14-2016, 06:28 PM   #18
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Car-Guy. The only way to improve your score would be to use credit more. You don't have any load activity to judge.

I was in the low 790's with using 2 cc's, no cars or mortgage in recent history. I got a new CC for a sign up bonus, cashed that in, and yay now I'm 810 lol.

Amex does a similar thing to Cap1, and it said "not enough accounts paid as agreed" which can mean you've been late, or you just don't have enough accounts... I guess 2 is lame, 3 is cool?

Intuitively, I should be worse now, because I've had another inquiry, and I'm potentially taking on more debt. But score wise, I'm showing more payments, and I've now an even better debt to line ratio (since even though I pay in full each month, the closing balance is still debt to the score).

It's stupid at the high end of things. Anyway, I think most of the lenders bracket the scores - and 800+ is the "we will bend over backwards for you" zone.
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