Lender says I have to remove authorized user accounts - true?

[Anonymous]

I am in the initial stages of hunting for a mortgage loan.  I did the initial online prequalification with a mortgage broker and she called me back and left a message saying everything looked good, but there were a few authorized user accounts which i would have to get removed from my credit report.  These are all my mom's accounts which i've never used.  Their combined limit is around $15,000 I think - there is only one balance of $400.00 on there now.  She has excellent credit, keeps the limit very low and pays them off every month.

I don't want to remove them...I have never had a credit card and my scores are low to average (EQ 630 (because of erroneous information) EX 684 and TU 689).  I don't want my scores to lower.  Do I have to remove them?  I live in Texas, btw, which I understand is a community property state.  Not sure how that plays into it.

Thank you to anyone who can help.  I had a bad experience with a previous lender and now this has come up...this mortgage experience is causing me a lot of anxiety and I'm having troble finding good and accurate information.

[Anonymous]

Tell the LO you are worried that if you do it will lower your score because you do not have any CC's of your own.. Do you have 3 trade lines reporting?

[namvet]

You need to get a second opinion!  Never heard of this request before.  IMO you don't want to remove the au accounts.

[Anonymous]

I will ask her about this before removing them.  She is out of the office tomorrow but I will call her Monday.  I do not have three tradelines reporting - I only have one which is a student loan.  I bought my car with cash and have never owned a home before.  I have always shied away from taking on debt but it is coming back to bite me now.  My only debt is student loans at $158/month.  I also have an 8 year old collection on my account from a medical bill error that I haven't been able to get fixed..they are reporting it opened in 2006 which is false.  It is only on Equifax and I'm worried about getting an FHA loan.  I do have utilities with nothing late beyond 12 months so perhaps i can use these.  She did not bring up tradelines.

Is it possible this is an in-house requirement?  I tried another lender before this who never returned my calls and didn't answer my questions so i'm trying another.  He didn't mention having to be removed as an authorized user though.  This is really frustrating.

[DallasLoanGuy]

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@Anonymous wrote:

Is it possible this is an in-house requirement?  I tried another lender before this who never returned my calls and didn't answer my questions so i'm trying another.  He didn't mention having to be removed as an authorized user though.  This is really frustrating.

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This is not necessarily an in house guideline. It is an 'underwriter discretion' guideline.

When a borrower has minimal trade lines to consider for credit worthiness and there are a lot of 'auth user' accounts present, then the underwriter can consider the credit score invalid.

try another lender and see what their underwriters say.

the other lender will likely want to see a full Mortgage Trimerge credit report before rendering judgment.

who is the lender?

[Anonymous]

Thanks for the reply.  I'll try another lender as well.  I'll also get in contact with them and see if I have to remove all of them...maybe if I can only remove one my credit won't take quite the same hit.