The age of each credit card is a key factor in determining the length of your credit history. As an example, suppose you have three credit accounts: Card One has three years of age, Card Two is five years, and Card Three has one year. In this instance, your credit history is three years.
15 points
Your credit score may be affected by how long you have had your credit history. Credit scoring models factor in how old your oldest account is when determining your score. To find out how old your oldest account is, check out your credit report. This information will help you improve credit scores. There are several things you can do in order to increase your credit score.
128 Points
You can improve your credit score by paying more than the minimum payment on your credit cards and by reducing your total balance on all your credit cards. To avoid going above your credit limit, you will need to establish one. Lenders look for evidence that you have managed your credit well over a long time. A credit history's length is worth approximately 128 points. It shows when you first opened your accounts and when you last made a payment on each one.
If your credit score is below 128, you won't be able to get a loan or credit card. However, there are many ways to improve it. It may take years for your credit score to reach a high point, but it is possible.
Age
Your credit score is affected by the age of your credit history. Your score will increase if you have more than one credit account. Closing a credit card account can also damage your score. There are ways you can reduce the impact of closing your credit account.
The average number of years in which you have been a credit card holder is used to calculate the age of your credit record. For example, three credit cards equals three years. If you have five cards or more, your credit history would be seven.
An in-depth inquiry
Being diligent and keeping track of your credit score are the best ways to manage it. Many banks offer tools that can be used to check your credit score and credit reports for free. Experian offers access to your FICO(r), Score for free. Regular monitoring of your credit report will reduce the impact of difficult inquiries.
Lenders will require a copy to verify your credit history when you apply for loans. This is called a "hard inquiry" and it will affect your credit score. These inquiries will not be included in your credit score for one year. These inquiries will also disappear after two years.
Average age of account
It is important to look at the average age of all your credit accounts when you are looking at your credit history. A longer history will improve your credit score. However, a shorter one will result in a decrease. There are many factors that determine how long your credit history is, including your age and demographics. Keep your credit accounts current and open to increase your credit history.
Having a long credit history will benefit you when applying for a loan or applying for a credit card. You will have a lower average age if you open credit accounts. Do not open new credit accounts unless you have a clear goal.