Of course, those with negative marks such as missed payments or collection items will stay as well and can hurt your score, but not quite as long. These negative accounts will disappear from your credit report after seven years. While there is no hard and fast answer to this question, seven years seems to be a magic number when it comes to credit scoring.
As previously noted, it takes seven years for negative information to fall off of your credit report. However, you can get a great credit score in a lot less than seven years. Those new to credit can get a FICO score once an account is about six months old and its payment history has been updated at least once; it takes even less time to get a VantageScore this can happen within a month or two of opening an account.
Still, older accounts in good standing will always serve to help your score. As noted above, a closed credit card account in good standing will remain on your credit report for at least 10 years and will continue to help your length of credit history score during that time. But after 10 years, a closed account will disappear. However, closing a credit card can still hurt your score. While there are good reasons for closing a credit card , when you do you lose the available credit on the closed card and your credit utilization ratio will suffer.
This is why I recommend you keep credit cards open unless you have a compelling reason to close. You may think that one of those compelling reasons is the interest rate you are charged for carrying a balance. Once you pay it off, continue to use it for expenses you have already planned for like groceries or gas. The added bonus is the continued help to your credit age.
Neither of these apply in the world of credit. Thin files with a short credit history are less attractive score lower than chubbier, older files! So, how can you maximize your credit history with a minimum of waiting? Be sure that the account is in good standing because TransUnion and Equifax may report negative information about an authorized user account, but Experian does not. Other than that and lacking a time machine , what you can do in the meantime is make sure to pay your all of your bills on time, each and every time, and watch how much of your credit you access.
You might look at your credit mix the types of accounts you have and consider opening a different type of account to help in this category. But be careful with this approach. Try to only apply for credit when you need it and when you are fairly sure you will qualify.
I promise you as long as you do these things that with time and patience, you can have one of those chubby credit scores that will afford you the things you want. Have a credit score question for Steve? Drop him a line at the Ask Bankrate Experts page. How We Make Money. Written by Steve Bucci. See your free score and the factors that influence it, plus insights into ways to keep building. Get started. Length of credit history vs. Credit age matters, but other factors matter more.
On a similar note Dive even deeper in Personal Finance. Explore Personal Finance. Finally, adopt a mindset where you see the length of your credit history as part of your greater long-term credit strategy.
Use your card, but keep the balances low and pay on time. If you do, you'll find yourself well on the road to building a strong credit history that you can put to work when you need credit. You may be tempted to shut down that credit card that you just paid off after years of making payments. Before you do, take a moment to consider what impact closing that account may have on your length of credit history.
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