Sign up for our FREE Monthly Email Newsletter
In addition to keeping in the financial know, you may be interested in checking your credit score and report.
¹The credit scores provided under the offers described here use the Equifax Credit Score, which is a proprietary credit model developed by Equifax. The Equifax Credit Score and 3-Bureau scores are each based on the Equifax Credit Score model, but calculated using the information in your Equifax, Experian and TransUnion credit files. The Equifax Credit Score is intended for your own educational use. It is also commercially available to third parties along with numerous other credit scores and models in the marketplace. Please keep in mind third parties are likely to use a different score when evaluating your creditworthiness. Also, third parties will take into consideration items other than your credit score or information found in your credit file, such as your income.
²The Automatic Fraud Alert feature is made available to consumers by Equifax Information Services LLC and fulfilled on its behalf by Equifax Consumer Services LLC.
³Equifax Credit Report Control™ is only available while you have a current subscription to Equifax Complete Premier. Locking your credit file with Equifax Credit Report Control will prevent access to your Equifax credit file by certain third parties, such as credit grantors or other companies and agencies. Credit Report Control will not prevent access to your credit file at any other credit reporting agency, and will not prevent access to your Equifax credit file by companies like Equifax Personal Solutions which provide you with access to your credit report or credit score or monitor your credit file; Federal, state and local government agencies; companies reviewing your application for employment; companies that have a current account or relationship with you, and collection agencies acting on behalf of those whom you owe; for fraud detection and prevention purposes; and companies that wish to make pre-approved offers of credit or insurance to you. To opt out of such pre-approved offers, visit www.optoutprescreen.com/.
4We will require you to provide your payment information when you sign up and we will immediately charge your card $4.95. After that, we will charge the card $19.95 for each month you continue your subscription. You may cancel at any time; however, we do not provide partial month refunds.
Equifax® is a registered trademark and Equifax Complete™ Premier is a trademark of Equifax, Inc. © 2014, Equifax Inc., Atlanta, Georgia. All rights reserved.
Opening a new credit account is one way to increase your available credit, build your credit history, and add more information to your credit report. But before you open a new credit account, it’s important to understand how doing so can impact your credit score. Your credit behavior, including opening new accounts, can impact where you stand on the credit score scale.
How long is an account considered “new” on my credit report?
After about one year on your credit report, an account is no longer considered “new credit,” depending on your credit behavior and borrowing history.
To see how your credit report changes after you open and begin to use a new account, you may want to consider monitoring it regularly. You’re entitled to one free credit report every year from each of the three credit reporting agencies through AnnualCreditReport.com. You can also purchase a credit monitoring product to access your credit report more often.
What are some of the ways opening a new account can impact a credit score?
A new credit account can diversify your credit mix. If you’re opening a new credit account that is unlike others you already have, you’ll diversify your types of credit used, which can impact your credit score. Creditors like to see that you are able to manage different types of accounts responsibly. Your credit score reflects the different types of accounts you have, including revolving debt (such as credit cards), and installment loans (such as mortgages, student loans, and auto loans).
A new account can shorten your average account age. New credit accounts can impact the length of your credit history, which accounts for 5 to 7 percent of your Equifax credit score. This calculation includes how long both your oldest and your most recent accounts have been open.
A new account will generate an inquiry. Each time you apply for a new credit account, it generates a “hard inquiry,” which is a request by a creditor for your credit history . Hard inquiries remain on your credit report for 24 months , and their impact on your credit score can lessen over time . (Your credit score does not take into account requests from creditors for your credit report or credit score in order to make pre-approved credit offers or promotional offers.)
Inquiries and new credit accounts may have a greater impact on someone with a short credit history and few accounts than on someone with a longer credit history.
Regardless of whether an account is new or has been open for some time, a priority should be ensuring payments are made in a timely fashion. Payment history accounts for 35 percent of your credit score, so paying your bills on time—or late—will have an impact. While an account may not be considered “new,” payment history on that account will always be factored into your credit score.
Diane Moogalian is vice president of operations for Equifax Personal Information Solutions. Prior to joining Equifax in 2007, Diane held several strategic roles with leading financial services companies.
The information contained in this blog post is designed to generally educate and inform visitors to the Equifax Finance Blog. The blog posts do not give, and should not be assumed to provide, personalized tax, investment, real estate, legal, retirement, credit, personal financial, or other professional advice. Before making any financial decision, you should always consult with the appropriate professionals who can explain your options, rights, and legal responsibilities, and advise you on any tax, legal, credit, or business implications that may result from those decisions. The views and opinions expressed by the authors of blog posts are their own views and may not be the views or opinions of Equifax, Inc. and/or its affiliates.
Equifax maintains this interactive forum for education and information purposes in order to allow individuals to share their relevant knowledge and opinions with other members and visitors. We encourage you to participate in discussions about personal finance issues and other topics of interest to this community, but please read our commenting guidelines first. Equifax reserves the right to monitor postings to the forum and comments will be published at our discretion. Do you have questions or comments about your Equifax credit report or customer-service issues regarding an Equifax product? If so, please contact Equifax directly. All opinions and information expressed or shared in blog comments are solely those of the person submitting the comments, and don't necessarily represent the views of Equifax or its management.