Length of Credit History
Length of credit history, or your “time in the bureau”, accounts for 15% of your credit score. The older you are, and the longer you have had credit accounts for, the higher the score. This is broken down into 3 sub categories:
- Time since accounts opened.
- Time since accounts opened, by specific type of account.
- Time since account activity.
Your credit history length is important when it comes to understanding your score as a longer credit history is looked upon more favorably than a shorter one. Someone with a credit history of 6 months isn’t going to look as impressive as someone with a history of 6 years. It takes time to establish a payment history. Those with longer credit histories typically have higher incomes as well.
When determining credit history length, the 3 Credit Bureaus mainly look at individual accounts. An account that has been opened and regularly used for a few years is going to influence your score more than a newly opened account that has only been used a few times. They also consider how long it has been since accounts were last used. An account that is opened but hasn’t been used in years will have little bearing compared to one that is opened and regularly used. This is why it is near impossible to get to an 800 score at a young age. As you have more accounts throughout your life and your history grows over time, your scores will naturally increase due to this factor. Being added as an authorized user to an account with a long pay history is another way to increase your scores. BUT, be careful how you do this. If missteps happen, you can damage not only your credit score, but also that of your co-signer.