Authorized User Accounts

[Anonymous]

will removing these accounts hurt your credit score?... i hear this summer when the bureaus switch to FICO 08... having such accounts could have a negative impact on your score...

[Anonymous]

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armychiefswife wrote:

will removing these accounts hurt your credit score?... i hear this summer when the bureaus switch to FICO 08... having such accounts could have a negative impact on your score...

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Removing AU accounts affect different people different ways. It could increase or it could decrease your score.

Removing them will have no different effect then FICO 08 will.

If and when FICO 08 is implemented and lenders begin using it, AU cards will still appear on your reports( I believe) but will not be looked at when your score is calculated.

So, if AU account is your oldest account or is keeping your util down, or you only revolving, you could see a decrease.

[Anonymous]

Exactly how removing an AU account will affect you depends on your credit report.

Imagine looking at your CR with the AUI accounts gone.

If the AU account is old it will lower your average age = -FICO.

If the AU account has good util % removing it will raise your overall util% = - FICO.

If the AU account has good paymanet history then you will lose that history = -FICO

If the AU has 0 balance removing it will alter the number of 0 balance % = -FICO

If the AU is at high util% removing it will lower overal util = +FICO

If the AU is newer account removing it will increase average age = +FICO

If the AU has derog removing it will remove them = +FICO

If the AU has no zero balance removing it may alter % of 0 balance cards = +FICO

So it really depends.  However removing an AU for the sole purpose that FICO 08 might me used in future is not a good idea.

1) Nobody knows for sure when it will be used.

2) When FICO-08 is implemented AU are simply ignored they don't have a negative impact.  It is like the AU are completely removed (all + or - effects above) when calculating your FICO. Any + or - will be the same as if you removed them. 

So if FICO-08 is going to result in a lower score than removing the account now will just give you a lower score sooner.

[Anonymous]

Ride this puppy out let the chips fall were they may nobody really knows just yet.

[Anonymous]

That's what they said LAST year.  Don't hold your breath for FICO '08.