Remove Myself as AU to Utilize AZEO for Mortgage Scores?

[Anonymous]

Hello there! I have been doing a lot in the past 6 months or so to bring up my credit. I’m hoping to qualify for a mortgage in the next month. My scores have gone up a lot, mostly by paying down cc debt, removing 2 collections, and paying off a charge off. My vantage scores went from 590 to 770 in 6 months! (Haven’t been keeping track of Fico for that long but currently, my Fico 8s are Eq: 704 TU: 730 and Ex: 721. However, my 5,4&2 mortgage scores are still lower than I would like. 686, 687, and 684. I was hoping to bring them up to a middle score of 700 using AZEO, but my dad ran a charge on his card which I am an authorized user on. It’s limit is $11k, higher than my three by a lot. However, even without being an AU on his card, my utilization is under 8%

Capital One 315/4000

Chase 0/1000

Credit One 0/450

His Capital One 1100/11,000

My question is, would removing myself as an AU on his card hurt my mortgage scores? Or help because then I would be utilizing AZEO?

I could wait obviously and ask him to pay it off and then wait for it to report next month, but our lease is up and time is of the essence, I was really hoping to prequalify this month.

Thank you so much for your help, I can provide more info if needed!

[Ficoproblems247]

With that level of utilization on his card, it is doing no harm to your profile. As long as that card is reporting in under 29%, you are golden. Depending on your lender, you may actually be asked to remove that AU account as that can be a policy depending on who you go through. If it were me, I would go for the prequalify as is, and ask your LO what they think about the AU situation once they crunch your numbers. They will let you know if they think that making any minor profile tweaks will be enough to yield more favorable terms. That's just my 2 pennies, maybe a mortgage guru will chime in with better specifics. I wish you the best of luck as you go through the process! 

[Anonymous]

Thanks you so much! I was wondering not so much if being an AU was hurting me per say, but more so if removing myself would help because then I'd be using the AZEO method that supposedly gives your mortgage scores a nice boost.  I know his limit is high, but my utilization is low either way with or without that account.

[Ficoproblems247]

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@Anonymous wrote:

Thanks you so much! I was wondering not so much if being an AU was hurting me per say, but more so if removing myself would help because then I'd be using the AZEO method that supposedly gives your mortgage scores a nice boost.  I know his limit is high, but my utilization is low either way with or without that account.

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That one is a bit tougher to answer, and honestly would likely require you to test that out and see how your own individual profile responds. As I understand it, the FICO algorithm will likely ignore your AU card in the AZEO mix. So if you practice AZEO with just your own cards, regardless of weather the AU card posts a balance or not, you will likely be seeing the best versions of your 5,4, and 2 you are able to. Now this can be profile specific as to how your score responds to AZEO with no balance on the AU card, vs. AZEO plus a balance on the AU card, which is why you'd have to test this out to know for certain. I know that is not the answer you were looking for while being in a time crunch! To be honest, I have a feeling the difference in points would be fairly negligible. 

[Anonymous]

No, 5/4/2 sees authorized user accounts just like primaries. So in another words, its seeing one more account with a balance than it should. Zero yours or zero his. 

If you terminate authorized user, it will reduce the denominator for AWB on potentially 5/4, therefore  potentially negating any benefit. At least on 2, closed accounts figure in the denominator of AWB. 

[Anonymous]

Thank you! I thought to maximize AZEO the card holding a balance should not be an AU account (or a store card)? It would be cheaper and faster to pay mine, but I know I read that here somewhere.

[Anonymous]

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@Anonymous wrote:

Thank you! I thought to maximize AZEO the card holding a balance should not be an AU account (or a store card)? It would be cheaper and faster to pay mine, but I know I read that here somewhere.

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@Anonymous ideally in a perfect world, yes it would be suggested & preferable to use yours and definitely not a store card. But the mortgage scores are going to see an authorized user account same as a primary, absent an error. 

However since you are in a pinch, you can get away with using the authorized user account as long as the credit limit is under $31,000 and it's a bankcard. We'll let you get away with it this time, just don't make a habit of it. 

you may get unexpected results on version 8/9, but that's not what you're worried about.