Credit Repair blog 3: Old vs. New accounts

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Mortgage and Lending with Legacy Group Lending

Credit Repair blog 3: Old vs. New accounts

So now you've learned how to get collection accounts paid off and or removed from your credit report. You've also learned the difference between installment and revolving loans and how each influences your score. Well what about the age of your accounts? How does that affect your credit report?

Time is one of the most noteworthy factors that can improve your credit score. Establishing a long history of paying your bills on time and using credit conscientiously will ensure your score stays at a healthy number for the long term. It should go without saying that if you have a credit card for years, use it about once a month and pay it off, that it will have a very positive effect on your credit score. This doesn't mean that you cannot open new credit cards or installment loans, rather it's the average age of your accounts that the bureaus will take into consideration.

Keep in mind that it's your active accounts that play the most significant role in determining your credit score. If you'd like to close an account out be sure to pick the youngest or most inactive. That way after your account is paid and closed, the remaining active accounts will be seasoned and show your long term ability to pay your bills responsibly.

The same goes for late payments, collections, charge-off accounts, etc. The more recent your negative pay-history, the greater toll it takes on your score. As mentioned in Credit Repair blog: Get to know your credit, you should get your collection accounts to show zero balance as soon as possible. After you've taken care of the balance of these negative accounts, it's only a matter of time before you see a significant improvement in your credit score.

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