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Authorized User Accounts now are not counted in scoring model!

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Administrator

Re: Authorized User Accounts now are not counted in scoring model!


@joejroe wrote:

Hello,

 

My scored dropped an average of 30 points each report due to the fact it seems that Authorized user accounts don't help you any more.  When my score dropped, I pulled my fico scores to see what was different and I noticed my age of accounts changed big time, digging in.. I see that they dont count authorized user accounts any more in any fashion.  Did this just change this month?  Anyone else notice it?


Here's a response from Tom Quinn, our credit expert: 

 

All FICO® Score versions include authorized user credit card accounts when calculating a FICO Score. This can help people benefit from their shared management of a credit card account. It also helps lenders by providing credit scores that are based on a full snapshot of the consumer's credit history.  To protect lenders and honest consumers, starting with FICO Score 8, the score calculation substantially reduces any benefit of so-called "trade line renting." That's a credit repair practice that entices consumers into being added to a stranger's credit account in order to misrepresent their credit risk to lenders.

Message 11 of 34
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Super Contributor

Re: Authorized User Accounts now are not counted in scoring model!


@Cindy_FICO wrote:

@joejroe wrote:

Hello,

 

My scored dropped an average of 30 points each report due to the fact it seems that Authorized user accounts don't help you any more.  When my score dropped, I pulled my fico scores to see what was different and I noticed my age of accounts changed big time, digging in.. I see that they dont count authorized user accounts any more in any fashion.  Did this just change this month?  Anyone else notice it?


Here's a response from Tom Quinn, our credit expert: 

 

All FICO® Score versions include authorized user credit card accounts when calculating a FICO Score. This can help people benefit from their shared management of a credit card account. It also helps lenders by providing credit scores that are based on a full snapshot of the consumer's credit history.  To protect lenders and honest consumers, starting with FICO Score 8, the score calculation substantially reduces any benefit of so-called "trade line renting." That's a credit repair practice that entices consumers into being added to a stranger's credit account in order to misrepresent their credit risk to lenders.


Dear @Cindy_FICO  Why does MyFICO say, with respect to age of oldest account and average age of accounts, that
"authorized user accounts aren't considered in the calculation of this attribute".

 

 


Total revolving limits 651000 (575000 reporting) FICO 8 EQ 727 TU 744 EX 729

Message 12 of 34
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Valued Member

Re: Authorized User Accounts now are not counted in scoring model!

No, nothing changed but the average age of accounts due to the fact of it not counting AU accounts.

Message 13 of 34
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Super Contributor

Re: Authorized User Accounts now are not counted in scoring model!

Again, the algorithm does not just one day decide to discount an AU account. To prevent trade line renting they did the anti-abuse flag. Only FI knows exactly how it works, the closest we can figure is, are the names and addresses the same.

However if no information like name or address changed for either one of you, then there is nothing that would have changed how the algorithm treated the account. Now, if a name or address changed, then there’s a possibility that maybe the flag could come up and effect it.

As for the attribute that gives your average age of accounts and states that it does not include AU accounts, notice that nowhere does it say that’s the age the algorithm is using as your AAOA when calculating your scores.

Just like Experian CW gives you two different places that potentially have two different average ages (one includes AU accounts and the other does not), MF gives you an average age calculated without AUs. But, again, nowhere does it say that’s the age the algorithm is using. Neither does CW tell you which one they’re using. From what I’ve learned, the only way to find out whether or not they are counting is to do a test and see. As a matter of fact, MF doesn’t even calculate the score, so they don’t know which age is being used. The score comes from the CRA.

Implement AZEO with the AU card. If you suffer the “no revolving balance penalty” of about 15 points when the AU card is the only one with the balance, then it’s not counting. I don’t know of any other way to know whether or not it’s counting. You cannot rely on the front end software from the CMS.
For a collection of our current FICO scoring wisdom, updated as we learn, read the following. Watch the revision dates on the bottom of the first 8 posts as they are regularly updated: Link to Scoring Primer.
RIP:




Updated June 2020, unless otherwise noted. I took an HP on EX, will reflect on next update.

(Forgive typos, mobile.)(Everything said is Just IMHO.)

In order to better answer your questions and record your DPs, please provide your profile stats: Any baddies? Severity and recency? (clean/dirty), Number of accounts, both open and closed on CRs (thick/thin), AoOA? (aged/nonaged), AOYRA-Age of Youngest Revolving Account (new accounts/no new accounts)? Open/closed loan on CR?
For example, mine is clean/thick/aged/new account, with open loan on record.
If you don't know where you fall, just detail any baddies, your number of open and closed accounts, AoOA, AOYRA and whether you have a loan on record.

For utilization questions, list individual and aggregate utilizations, revolving and installment, please.
Message 14 of 34
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Administrator

Re: Authorized User Accounts now are not counted in scoring model!


@SouthJamaica wrote:

@Cindy_FICO wrote:

@joejroe wrote:

Hello,

 

My scored dropped an average of 30 points each report due to the fact it seems that Authorized user accounts don't help you any more.  When my score dropped, I pulled my fico scores to see what was different and I noticed my age of accounts changed big time, digging in.. I see that they dont count authorized user accounts any more in any fashion.  Did this just change this month?  Anyone else notice it?


Here's a response from Tom Quinn, our credit expert: 

 

All FICO® Score versions include authorized user credit card accounts when calculating a FICO Score. This can help people benefit from their shared management of a credit card account. It also helps lenders by providing credit scores that are based on a full snapshot of the consumer's credit history.  To protect lenders and honest consumers, starting with FICO Score 8, the score calculation substantially reduces any benefit of so-called "trade line renting." That's a credit repair practice that entices consumers into being added to a stranger's credit account in order to misrepresent their credit risk to lenders.


Dear @Cindy_FICO  Why does MyFICO say, with respect to age of oldest account and average age of accounts, that
"authorized user accounts aren't considered in the calculation of this attribute".

 

 


While AU accounts are considered in the calculation of the FICO Scores, their contribution to the overall score value is relatively minor. Since it is relatively minor, myFICO doesn’t include AU accounts in our score explanation features.

Message 15 of 34
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Super Contributor

Re: Authorized User Accounts now are not counted in scoring model!

@Cindy_FICO So it’s not included in the score explanation features but that does not mean it is not “considered” by the algorithm when computing the score.

And if it’s FICO 8 or 9, it can be both considered and rejected, if flagged by the anti-abuse portion of the algorithm, right? So, being “considered” is not tantamount to the attribute actually being used as part of the computation to create the score is it?
For a collection of our current FICO scoring wisdom, updated as we learn, read the following. Watch the revision dates on the bottom of the first 8 posts as they are regularly updated: Link to Scoring Primer.
RIP:




Updated June 2020, unless otherwise noted. I took an HP on EX, will reflect on next update.

(Forgive typos, mobile.)(Everything said is Just IMHO.)

In order to better answer your questions and record your DPs, please provide your profile stats: Any baddies? Severity and recency? (clean/dirty), Number of accounts, both open and closed on CRs (thick/thin), AoOA? (aged/nonaged), AOYRA-Age of Youngest Revolving Account (new accounts/no new accounts)? Open/closed loan on CR?
For example, mine is clean/thick/aged/new account, with open loan on record.
If you don't know where you fall, just detail any baddies, your number of open and closed accounts, AoOA, AOYRA and whether you have a loan on record.

For utilization questions, list individual and aggregate utilizations, revolving and installment, please.
Message 16 of 34
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Super Contributor

Re: Authorized User Accounts now are not counted in scoring model!

I read the response from Cindy as “there are not many points available for setting up an AU”.  So why bother?

 

Instead of pursuing the idea that AU is magically adding many points to users accounts, perhaps it is time to stop, and start gathering data points. The AZEO method is similarly dangled to new members as an “optimization” method when for FICO 8 it is really just low utilization.  Maybe AU is similarly not a benefit.  

 

It seems most of the people we see trying for AU are rebuilding, and thus in dirty files. Others are new to credit, and experiencing rapid changes on thin files. Are any of those files quiet enough that the benefit of adding the AU is able to be isolated?   

 

 

High Bal Jan 2009 $116k on $146k limits 80% Util.
Oct 2014 $46k on $127k 36% util EQ 722 TU 727 EX 727
April 2018 $18k on $344k 5% util EQ 806 TU 810 EX 812
Jan 2019 $7.6k on $360k EQ 832 TU 839 EX 831
Message 17 of 34
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Frequent Contributor

Re: Authorized User Accounts now are not counted in scoring model!


@NRB525 wrote:

I read the response from Cindy as “there are not many points available for setting up an AU”.  So why bother?

 

Instead of pursuing the idea that AU is magically adding many points to users accounts, perhaps it is time to stop, and start gathering data points. The AZEO method is similarly dangled to new members as an “optimization” method when for FICO 8 it is really just low utilization.  Maybe AU is similarly not a benefit.  

 

It seems most of the people we see trying for AU are rebuilding, and thus in dirty files. Others are new to credit, and experiencing rapid changes on thin files. Are any of those files quiet enough that the benefit of adding the AU is able to be isolated?   

 

When you say most? Im not most since the dirty file is long gone. I added the AU since I was using the card and paying for it, I have 1 personal card that is 4.5yrs old and a clean credit report. The only benefit that the AU has helped me with is age, credit score and CL on paper, in real life creditors dont look at the AU, they are looking at my own personal credit and even with a credit score above 800, perfect payment history and clean report, I am still branded as a dirty file. I will still keep the AU account on my report, because I will continue to use it ad pay for it.

 

 


 

EQ 812 / TU 802 / EX 818 (Before the credit sprees will update soon)
Message 18 of 34
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Super Contributor

Re: Authorized User Accounts now are not counted in scoring model!

@FenderGuy How or why are you branded as a dirty file if your report is clean?

@NRB525 I’ve never had a dirty file and neither is my credit new, yet I have a few AU cards. The AU accounts did buffer me when my oldest individual accounts fell off though and kept me from re-bucketing I think. (I know I don’t represent the majority though.) Actually they were very useful for testing because they allowed me to find multiple AAOA break points as added. 😉
For a collection of our current FICO scoring wisdom, updated as we learn, read the following. Watch the revision dates on the bottom of the first 8 posts as they are regularly updated: Link to Scoring Primer.
RIP:




Updated June 2020, unless otherwise noted. I took an HP on EX, will reflect on next update.

(Forgive typos, mobile.)(Everything said is Just IMHO.)

In order to better answer your questions and record your DPs, please provide your profile stats: Any baddies? Severity and recency? (clean/dirty), Number of accounts, both open and closed on CRs (thick/thin), AoOA? (aged/nonaged), AOYRA-Age of Youngest Revolving Account (new accounts/no new accounts)? Open/closed loan on CR?
For example, mine is clean/thick/aged/new account, with open loan on record.
If you don't know where you fall, just detail any baddies, your number of open and closed accounts, AoOA, AOYRA and whether you have a loan on record.

For utilization questions, list individual and aggregate utilizations, revolving and installment, please.
Message 19 of 34
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Frequent Contributor

Re: Authorized User Accounts now are not counted in scoring model!


@Birdman7 wrote:
@FenderGuy How or why are you branded as a dirty file if your report is clean?

@Birdman7 I might as well be when Discover is offering me 25% APR and a SL of $2700, that the same APR as my Capital One when I got it 4.5 years ago with 700 across all 3....

 

EQ 812 / TU 802 / EX 818 (Before the credit sprees will update soon)
Message 20 of 34
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