Sunday, June 17, 2007

Piggy-backing off of someone elses credit history to increase yours? It works!!!

For those of you out there who cannot purchase today due to lack of sufficient credit scores (which has become evermore increasinly difficult in spite of this changing market) there may be hope in sight. I just came across this article from Mortgage Daily News and thought I would share it with everyone out there who may have a blemish or two preventing them from following the American Dream. The article can be found here. (My disclaimer: make the right decisions from day one, monitor your credit and make sure that you are doing everything possible to maintain the highest possible score.

Read on....

Credit PiggyBacking
June 6th, 2007 · No Comments

If your credit score, typically between 350 and 850, is lower than you would like it to be, there are steps you can take to improve your credit history. Learning the steps to improve your credit score and how to keep it up is easier than you think. With the plethora of consumers in debt these days, many are scrambling to find easy, quick ways to improve credit score. If you want to improve your credit score take a few simple steps such as: paying down your debt, reduce credit card charges, opening new credit card account, and avoid filing bankruptcy.
One of the newest methods out there is to borrow or rent someone else’s credit.

Here is how it works:
Borrower A has a credit score in the 680 range and is trying to buy a house. The problem he has is that his credit history has a couple of little blemishes on it and his balance to credit available ratio is too high.
Borrower B has perfect credit, credit score in the 800 range, 6 credit cards, a auto loan, a mortgage and a small business line of credit. His balance to credit available ratio is very low. He has set himself apart from the vast majority of other consumers.
Borrower A rents or borrows a portion Borrower B’s credit history. Basically Borrower B puts Borrower A on one of his high limit credit cards. Borrower A doesn’t get a card and is not allowed to access the credit card account. So what’s the benefit to Borrower A you ask? As soon as Borrower A is put on Borrower B’s account Borrower A now has the new credit card on his history. He gets the benefit of a credit card with a long history of on time payments and his balance to credit available ratio has improved as well.
These two things will go a long way to help improve your credit score.
So what’s the down side? Two words: Identity Theft. If you want to rent or borrow someone’s credit history you’re going to be required to provide all you personal information to the person whose credit you’re borrowing. As with anything on the internet, if there’s a way for someone to exploit it then it will be exploited.
My advice is to stay away from Credit PiggyBacking and use more conventional methods to raise your credit score.
For information on credit repair or improving your credit score visit: CreditCardMonitor.Org/Credit Repair. While you’re there grab you FREE copy of “7 Credit Secrets”.

If you are unsure how to do this please let me know at and Ill be sure to put you in touch with a mortgage broker who can pull your credit and consult you on the best decisions to make to improve your credit.

1 comment:

Leila F. Search - said...

Credit piggy-backing has long been one of those "secrets" that creative mortgage bankers have recommended to their clients. If you are in the situation to buy a house and want to use credit-piggy backing do so as soon as possible. In September FICO will issue it's update credit scoring system and authorized user accounts will no longer count towards your credit scores.