What is happening with authorized user accounts and FICO?

Question

As you may or may not know currently, putting some one your account as an authorized user will increase that persons FICO score. (You are using the history of some one else).

I have heard that starting next month that this is no longer going to be the case? How true is that? What is the deal here? A person will be put on as authorized user but his or her FICO will not go up? When will this take effect? If some one is already an authorized user are they grand fathered in or will their FICO go down?

Lastly, I have been told that if the people do not have the same last name or it can not be proved that they are related that they will be invistigated for fraud(?) How true is that?

Please help!

Answer 1

You are correct as of next month the major scoring system FICO will stop including Authorized Users in the scoring system. Other scoring systems will stop using them over the next few months. So if you were an Authorized user once they stop doing that your score will change. There will be NO grandfathering in.

I have not heard about the last name thing. With the way the families are today, that is almost an impossible task to verify. Now if there is something else that is way out of the ordinary, they might investigate those. Such as having 20 or more Authorized users on one account.

Answer 2

Wow, Wow, Wow. This story has created so much buzz it is amazing. Don't take it personally, I saw a story on CNN that was so off the mark and lacking any verifiable facts it was just sad.
This whole thing started around credit "renting". Which by the way I have not seen any documentation that this actually works. Some people said they did it and it works, OK, but they didn't interview anyone who said it didn't work. As a funny sidenote, if person A piggy backs on person B's credit file then person B defaults or files BKO, that will go on person A's file. No one mentions that.
I would not worry about it. If your score goes down, OK. Manage your own credit as best you can, pay on time, pay off balances, limit inquires, your score will go up.
As for the fraud. More silly rumors. Card companies can barely catch the real criminals.