Just read this interesting article http://www.businessweek.com/ap/financialnews/D8PHGAHG1.htm It looks like people who use being added as authorized user to boost their scores are going to have to find another way. The articles pretty interesting. And I know some members of this board are going to not like it. Personally I think it's about time. Repairing your credit isn't supposed to be easy.
I was wondering how long it would take! Though legal, the practice does have a "feel that isn't right". I think in the end the legitimate authorized users will be the ones who are hurt.
exactly - how does that affect spouses that a real au's? I've been an authorized user on my husband cc for 7 years (and he on mine) ..............they need to find a system to weed out the real au and the ones that are in it just for the score boost..................
Although you must admit it does look attractive to the "sellers" of the AUs. I have to be honest that I'm considering selling some of my accounts! Talk about "easy money"! I didn't realize the aspect of "removing the AU" once the report is updated.... I have to admit it is a clever money making endeavor, and give its creator credit for coming up with it.....
I know I'll still be an au; I'm just saying that there are some that are real au that also pay the bill and some that just want the score hike.
More than likely, they'll make AU reporting more 'intelligent'... If the AU doesn't have the same name; or some other 'known' relation, it'll probably be masked, when they make the scoring changes.
Well, it will be interesting to see how the FICO model is "modified" to compensate for this! I can only imagine it will look for "activity" to verify an "actual" user. I don't know how they will mask by name, i.e adult children often have different married names, etc. It will be a scoring mess, I'm sure.
Hello, Unless I'm mis reading everything on all the forums and articles. This is only going to affect 1 CRA in Sept. Other 2 next year correct?
That's what FICO states in the article, but I have yet to see any formal announcement out of FICO yet. I'm sure they're trying to figure out a way to determine "legitimate AUs".
Wouldn't length of time as an AU be a legit indicator? If you have someone who's been an AU on a card for 2+ years (heck, even 1+), isn't it reasonable to assume that these people are legit AU's? I think we have all seen that some serious repair can be done in the span of 1 year. So if you're saavy enough to try to buy AU status for an entire year, you're probably also saavy enough to fix your damn credit...
I believe the problem is that even one or two years as an AU may not be enough to determine if the AU is "real". The problem is that the "purchased AU status" is removed once the tradeline is reported, the way reporting goes, the TL then stays on, as if it were still "active". You are only purchasing the AU status for about a month, and simply waiting for it to hit your reports, and then remove. So, how do you determine when "selling of AU accounts began? I think FICO will start looking for activity on these accounts; it seems the most legitimate way to see if the account is "real". Granted, I am sure there are many real AUs out there who do not use the accounts, but it would seperate the purchased from the real. I don't think any parent would mind a $20 purchase, paid in full at the end of a month, to ensure the goal of helping establish credit. I'm certain that AU status sellers would have a problem allowing the actual card/account number going to a complete stranger.
