Along with approved auto loans you can boost your efforts at credit repair by becoming an authorized user

In our experience

Bad credit applicants often ask us if there is anything in addition to terrible credit auto loans that can improve their credit scores.

We know what can be done as we’ve been in bad credit auto sales for twenty years here at Auto Credit Express. our web site is designed so that applicants can learn about such topics as new car incentives and repossession, as well as today’s topic, becoming an authorized user on a credit card account.

Authorized users

An authorized user is someone other than the actual account holder that’s added to a credit card account in a perfectly legal practice known as “piggybacking.”

If you have poor credit, becoming an authorized user tied to someone with a high credit score, low card balance and high credit limit, can improve your FICO scores in a couple of ways.

First of all, the additional positive credit activity will begin appearing on your credit report, making a positive impact on your credit scores.

Secondly, this new credit line will increase your available credit and, at the same time, lower your debt ratio. this can further improve your FICO scores.

To do it

Companies that specialize in credit repair solicit credit card account holders with high credit scores, offering to pay them for permission to add authorized users to their accounts. the company then assigns a client to one or more these accounts to help raise that person’s credit scores.

As authorized users, these clients cannot use these credit accounts or gain access to any personal or financial information they contain. but by being tied to account, they can take advantage of the payment history to improve their FICO scores.

Credit bureau response

This practice has attracted the attention of FICO as well as the three credit bureaus that resulted in the “FICO 08″ scoring model. this model was specifically designed to ignore authorized user accounts when calculating credit scores.

But FICO 08 also caused a problem. According to FICO, they were informed by the government that ignoring authorized users would obstruct the company’s compliance with the Equal Credit Opportunity Act, Regulation B – a regulation that requires lenders to consider shared accounts of spouses when determining a married person’s credit risk. if the new model ignored these accounts, it would be in violation of Regulation B.

According to FICO it has since adjusted the formula of FICO 08 to include authorized users while reducing the impact of piggybacking. So as it now stands, authorized users continue to be included.

Piggybacking problems

There is a possible downside to becoming an authorized user. if the account holder continues to pay like clockwork, your FICO scores will continue to reflect this positive activity. but if, for some reason, the account holder is either late or misses one or more payments, your own credit scores could also drop.

As we see it

You need to decide for yourself if becoming an authorized user is for you. if you decide to become one, you need to be sure that you can handle the possible downside if the payment habits of the account holder suddenly change.

If you decide it’s time to establish your auto credit, you should know that Auto Credit Express specializes in helping people with bad credit find a dealer for their best chance at getting approved for poor credit car loans.

So if you really want to get your car credit back on track, you can begin now by filling out our online auto loans application.

Tags: authorized user, Bad Credit, Credit Repair

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Credit Repair as an Authorized User