15% of the consumer credit score is based on length of credit history. This accounts for how long the consumer has had open credit on their report. This is the third biggest factor affecting credit scores, right behind payment history, which accounts for 35% of the total score, and available credit which accounts for 30%.
This one factor has a big impact on the overall score, and it’s very hard to control. Accounts can’t be added to the credit report with past history, so how long someone has had credit does link back to when they opened their first account that reported to the credit reporting agencies.
This is also why it’s harder for younger consumers to have excellent credit scores of 750 or higher. They must have a lot of credit, over a long period of time, to really have those kinds of scores.
However, there is one thing consumers can do to boost this aspect of their overall score – get added as an authorized user to a family member’s existing credit card account.
An authorize user can be established if a family member calls their existing credit card company and asks to have another family member added as a user. With the FICO 08 credit score, the consumer must be added to another family members account for there to be an impact to their score.
Once added as an authorized user, the family member can then use the credit card without having their credit pulled to qualify for the account. Once the consumer becomes an authorized user, the account is added to their credit profile, and they receive the full benefit of the long-standing positive pay history account.
Adding these types of accounts to reports are the only way to show a longer credit history, beyond the other accounts the consumer might already have on their report. And if the newly added account has a good payment history and good utilization ratios, it can have an ever greater impact on raising the score.
Help your clients get added as an authorized user today for a nice credit score increase, and to insure they have a healthy credit profile and healthy financial future.