topic Re: Authorized Users and Credit Scoring? in Understanding FICO® Scoring

Authorized Users and Credit Scoring?

MrCredit — Wed, 18 Jan 2012 10:10:33 GMT

Are authorized users credit cards still counting in the FICO formula? I am wondering if I add someone

to my account if their score will go up still or is that since been discounted from the scoring calculations on

FICO?

Re: Authorized Users and Credit Scoring?

pizzadude — Wed, 18 Jan 2012 12:09:22 GMT

Yes ~ AUs are still factored into your FICO score. There was talk at one point about FICO changing that, but they backed away.

Adding someone as an AU to your CC will add it on to their Credit report, including the balance, CL, payment history, etc. so obviously you want to make sure that you add them to a card in good standing.....

Re: Authorized Users and Credit Scoring?

CS800 — Wed, 18 Jan 2012 14:24:32 GMT

And the beauty for the AU, no HP on your reports

Re: Authorized Users and Credit Scoring?

poops — Wed, 18 Jan 2012 15:10:56 GMT

What happens if the AU is removed from the CC by the owner of the card? Does the account info still appear on the AU's CR after being removed from the account?

Re: Authorized Users and Credit Scoring?

pizzadude — Wed, 18 Jan 2012 15:14:32 GMT

@poops wrote:
What happens if the AU is removed from the CC by the owner of the card? Does the account info still appear on the AU's CR after being removed from the account?

Sometimes yes, sometimes no. It depends on the Creditor's procedures. In either case if the Ex-AU wanted it removed they could dispute it with the CRA....

Re: Authorized Users and Credit Scoring?

ccb2115 — Wed, 18 Jan 2012 16:04:44 GMT

@poops wrote:
What happens if the AU is removed from the CC by the owner of the card? Does the account info still appear on the AU's CR after being removed from the account?

This actually happened to me. When my uncle removed me as an AU to his AMEX it was removed from EX, but EQ and TU, which is why my EX score is lower than my two other scores. I wasn't really sure what the "right" procedure was for this, so I called AMEX and asked why it was no longer reporting on EX, but was still on TU and EQ. They said, "Oh, I'm so sorry sir, we will remove it from TU and EQ by next week." My heart skipped a beat and I yelled NO!!! I want it to report!! I just wanted it to also report on EX. She said "No, we cann't do that, but I will keep it on you TU and EQ. I just want you to keep in mind that this is being incorrectly reported".

Thank god my uncle was willing to put me back on.

Re: Authorized Users and Credit Scoring?

RobertEG — Thu, 19 Jan 2012 21:54:17 GMT

Grant or termination of AU status is not mentioned or controlled under the FCRA. It is at the discretionon of the creditor. So is the practice of including the credit history of another in a consumer's scoring.

The FRCA does not control reporting to a consumer's credit file when the consumer is not a creditor. Some creditor are now restricting grant of AU status only to immediate family members, and others have discontinued the practice completely.

If AU status is terminated in some manner that violates other federal laws, such as being based on age, race, etc. discrimination, recourse would be through that statute, not the FCRA.

The fact that FICO chooses (or is forced to) score AU reporting is a private business matter. The FCRA does not regulate the innards of credit scoring.

Re: Authorized Users and Credit Scoring?

Anonymous — Mon, 23 Jan 2012 20:51:20 GMT

What is the best credit card to be an authorized user on? By that question I mean, fastest at reporting. Also, my mom added me to her Sears Mastercard, but they didn't ask for a SSN or anything other than my name. I am assuming that it will not be added to my credit report. Is that accurate?

Re: Authorized Users and Credit Scoring?

pizzadude — Mon, 23 Jan 2012 21:18:27 GMT

I honestly don't know which cards would report fastest....but they can add it to your CR without getting your SSN directly. They can do it with name & address I think....

Re: Authorized Users and Credit Scoring?

vanillabean — Mon, 23 Jan 2012 21:22:21 GMT

@Anonymous wrote:
What is the best credit card to be an authorized user on? By that question I mean, fastest at reporting.

All my cards (Visa, MC, Amex, Discover) thankfully report fast at this time. EX picks them up in 1-2 days after the statement date (the end of the billing cycle), EQ 3-4 and TU 4-5.

It wasn't always so, as Amex would take close to a month, but not anymore. I can generally predict quite accurately when myFICO's Score Watch will send me an alert with an updated score.

Re: Authorized Users and Credit Scoring?

RobertEG — Tue, 24 Jan 2012 02:29:28 GMT

I am not keen on adding AUs for a more practical reason.

Everything else related to FICO scoring isolates your scoring to your own personal management of credit. That even includes no merging of scoring based on marriage.

AUs are the exception.

Aside from the actual scoring inflation, when a creditor is considering an app for credit based on inclusion of the history of another in your scoring, how are they to use your score should they want to determine your actual payment risk? Not having their own FICO algorithm, they cant.

They have no way of separating your contribution in the score from the joint scoring with the AU history, other than a guesstimate.

It thus, at least in my opinion, may result in their discounting of your entire FICO score in their decision making.

Re: Authorized Users and Credit Scoring?

vanillabean — Tue, 24 Jan 2012 03:15:06 GMT

@RobertEG wrote:
I am not keen on adding AUs for a more practical reason.
Everything else related to FICO scoring isolates your scoring to your own personal management of credit. That even includes no merging of scoring based on marriage.
AUs are the exception.
Aside from the actual scoring inflation, when a creditor is considering an app for credit based on inclusion of the history of another in your scoring, how are they to use your score should they want to determine your actual payment risk? Not having their own FICO algorithm, they cant.
They have no way of separating your contribution in the score from the joint scoring with the AU history, other than a guesstimate.
It thus, at least in my opinion, may result in their discounting of your entire FICO score in their decision making.

I touched on the shared household income in another thread, so I'll just note here for income that's not shared that there are probably individuals who are thick on others' credit and thin on their own. Wouldn't skimming a credit report adequately satisfy the trained eye? Maybe the decision maker could have in place a threshold ratio of total credit for AU vs own?

Re: Authorized Users and Credit Scoring?

RobertEG — Tue, 24 Jan 2012 08:17:00 GMT

The trained eye would have to be able to calculate a FICO score, excluding the AU information.

Not even trained eyes have access to the proprietary FICO scoring algorithm, so no score could be produced.

Sure, one could view the CR and guess at the outcome, but then the entire FICO score becomes meaningless.

Re: Authorized Users and Credit Scoring?

vanillabean — Tue, 24 Jan 2012 15:05:04 GMT

@RobertEG wrote:
The trained eye would have to be able to calculate a FICO score, excluding the AU information.
Not even trained eyes have access to the proprietary FICO scoring algorithm, so no score could be produced.
Sure, one could view the CR and guess at the outcome, but then the entire FICO score becomes meaningless.

It could be said though that if one were to extract any AU and joint impact from the credit picture, one would put into doubt the ability of FICO to take into account such a factor, and where does it stop?

What if I fell behind paying the mortgage by myself and wasn't qualified for extra credit cards? What if DW likewise? Would such an individuality be any more realistic? The entire FICO score becomes meaningless.

Inspired by the intent to isolate, I looked into what my score would be without the AU cards provided by DW and also what her score would be without the AU cards provided to her by me.

It's highly unscientific, but I dusted off my own informal mini FICO toy approximator, a script that I once wrote to see how close I could get to what the EQ algorithm spits out.

It would appear I would lose ~10 points, due to her old Amex account, and she would gain ~5. No call for breaking up, we were married and had shared income already then.

The question is if we are fuller individuals when isolated or when sharing. Where would modern civilization be if not for interacting with each other? Would there be any Fair Isaac Corporation?

Re: Authorized Users and Credit Scoring?

Anonymous — Wed, 25 Jan 2012 00:06:43 GMT

I am still confused.

So, if my wife added me to her AMEX CC as AU. Her credit limit is 10k and she max it out. Will that impact my credit score as well?

Re: Authorized Users and Credit Scoring?

pizzadude — Wed, 25 Jan 2012 00:56:39 GMT

@Anonymous wrote:
I am still confused.

So, if my wife added me to her AMEX CC as AU. Her credit limit is 10k and she max it out. Will that impact my credit score as well?

Yes. It will be factored into your AAoA and her previous payment history will be on your report as well.

If it is a Charge Card the balance is only factored into %util on the TU98 FICO version ( MyFICO ), it is ignored by other FICO versions.

Re: Authorized Users and Credit Scoring?

Anonymous — Thu, 19 Jul 2012 15:35:39 GMT

I am pondering adding a relative to a credit card as an AU. How, if at all, does this impact my or other existing AU's credit score? Thanks in advance for your expertise!

Re: Authorized Users and Credit Scoring?

MarineVietVet — Thu, 19 Jul 2012 17:33:59 GMT

@Anonymous wrote:
I am pondering adding a relative to a credit card as an AU. How, if at all, does this impact my or other existing AU's credit score? Thanks in advance for your expertise!

Hello and welcome to myFICO.

Adding someone to one of your accounts as an AU has no effect on your credit whatsoever as long as they don't have access to a card. But if they happen to charge something and it raises your uitilzation then yes that could have an impact on your credit as well as any other AU's on your account(s).

So the best thing to do, in my opinion, is to add someone but not allow them any access to a card.

Re: Authorized Users and Credit Scoring?

Anonymous — Wed, 26 Sep 2012 18:04:37 GMT

Hello

I have a similar question about adding authorized users to an account. This is my first time doing this. I have tried to find answers online and even asked credit cards directly and have been given contradicting answers.

I, today, just added an authorized user to an Old Navy Visa credit card. I was told by a representative that the information from this credit card would be reflected on the authorized users credit report. When I asked how this could happen when they were only given a name, the person could not answer my questions so she transferred me to a supervisor. The supervisor then told me that as of 2011, account/credit card information IS NOT reflected on an authorized user's credit report. So, which is true?

I am hoping to assist in building the authorized user's credit score. I will not allow them access to the card, but I will be monitoring (approving) purchases and making sure payments are made on time.

I also read somewhere that whether or not account information is reported to the AU's credit report is up to the credit card peoples.

Can someone help me understand? If I am not able to help their credit score, I have no reason to have them as an authorized user. Thank you in advance for your help!

Re: Authorized Users and Credit Scoring?

agforfree5 — Mon, 01 Oct 2012 19:49:57 GMT

@Anonymous wrote:
Hello

I have a similar question about adding authorized users to an account. This is my first time doing this. I have tried to find answers online and even asked credit cards directly and have been given contradicting answers.

I, today, just added an authorized user to an Old Navy Visa credit card. I was told by a representative that the information from this credit card would be reflected on the authorized users credit report. When I asked how this could happen when they were only given a name, the person could not answer my questions so she transferred me to a supervisor. The supervisor then told me that as of 2011, account/credit card information IS NOT reflected on an authorized user's credit report. So, which is true?

I am hoping to assist in building the authorized user's credit score. I will not allow them access to the card, but I will be monitoring (approving) purchases and making sure payments are made on time.

I also read somewhere that whether or not account information is reported to the AU's credit report is up to the credit card peoples.

Can someone help me understand? If I am not able to help their credit score, I have no reason to have them as an authorized user. Thank you in advance for your help!

I have had a very similar experience and I am looking for an answer as well.. anyone?