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Credit Repair/Thought I Was Doing Everything Right!! How Much Will My Score Drop?

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Question
18 or 19 years ago, as a naive college student, I opened 2 credit cards. I didn't have a job so I racked up the debt and it went unpaid for years until I graduated. I paid those credit cards off in 2007 but was 30 days late on both of them in Dec 2006. Those 30 day late payments were the result of a mistake (I thought I'd paid them but hadn't) but it's almost 7 years and those late payments will fall off my report. I have 1 other 30 day late payment from July 2010 -- again a mistake and a misunderstanding that I must live with for another 4 years.

I was recently reading about how someone's score dropped at least 20 points after their late payments fell off as it lowered their age of accounts. My oldest account now is 1995 when I opened those 2 accounts. The next oldest is 2002 when I started paying my student loan -- 3rd oldest is 2006. After the 2 late payments fall off in 3 months, the age of my accounts will go down again as those accounts were closed by the lender 10 years ago or more. I opened 2 new credit cards April 2012 so that lowered my age of accounts again to about 4 years and some months. Right now my scores range from 747-813 and it took me so long to get them so high. I was thinking of opening another 1 or 2 cards next year to compensate for the 2 that will fall off my account in December but again it will lower my age of accounts.

How much can I expect my scores to drop and how long will it affect my score?

Answer
Hello Thera,

Your credit score benefits from having open accounts with a long average length of history.  The older the accounts, the better. This all comes back to stability, and it sounds like you clearly understand this.

There's only one thing that I need to re-iterate. What impacts your credit score is the average length of OPEN accounts. If the late payments are reporting on accounts that are open, then the account will continue to report to your credit file, without the late payments, and should in fact increase your credit score. If the account with the late payments is closed, the removal of that account from your credit file should not impact your credit score negatively at all.

http://www.creditfirm.net/education/length-of-credit

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Michael Abramsky

Expertise

I can answer questions for U.S. consumers that have issues with their credit reports, improving their credit scores, and dealing with debt collectors. I have extensive knowledge of the FCRA, FDCPA, FCBA, HIPAA, as well as the CDIA's Metro-2 and eOscar credit reporting systems. I am not an Attorney and do not offer Legal advise.

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As a Senior Credit Consultant for CreditFirm.net I help clients leverage consumer protection laws and rebuild their credit to improve their credit scores.

Education/Credentials
Loyola University Chicago Villanova University CSSBB

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