I have been seeing quite a bit in the papers recently about people who rent their credit cards to those who need to raise their credit scores to get a mortgage. Anyone have any experience with this?
“Put your creed in your deed.” Emerson
“When asked if you can do something, tell’em “Why certainly I can”, then get busy and find a way to do it.” T. Roosevelt
Replies
You have a low credit score?
How can renting a card with someone elses name on it affect another persons credit score? Did I miss something?
[email protected]
Some of the "Instant Good Credit" companies are running this scheme. While it is not illegal yet, congress is "looking into" the practice.Renting a card means that the "IGC" Company/you put someone on your card as an authorised user. They don't get a copy your card. They don't get your cards number. There is no way they can use your card. But, when they apply for credit they get the rating benefit of having your card as their own. At the end of the "lease," their authorization gets taken away.Get together with a couple of freinds with fair credit. Each of you put all the others on your cards as authorised users and all of you wind up with an excelent credit rating. Each person would list all cards as being theirs on the application.SamT
Praise the Corporation, for the Corporations' highest concern is the well being of the public.
The latest scheme.....................[email protected]
No, its not for me. I have an excellent credit rating. I was thinking about renting out one of my card numbers. The articles I read say that you can get $150 per rental, and 6-8 rentals is common. The little I have read seems to indicate that it is currently legal and safe for the rentor. The big risk is to the mortgage lender who lends based on wrong info, and to the rentee who might be getting in over their head."Put your creed in your deed." Emerson
"When asked if you can do something, tell'em "Why certainly I can", then get busy and find a way to do it." T. Roosevelt
If you start swimming now you might be able to catch the ship ;)
NEW YORK — Fair Isaac Corp. said Tuesday the next version of its FICO score will no longer consider certain kinds of credit card accounts, closing a loophole that allowed strangers to coattail on a cardholder's good credit.
The company's action comes after lenders and industry officials raised concerns over credit renting, a little-known but growing practice that allows people with bad credit to piggyback on strong payment histories of credit card holders. The person with a low credit score pays a fee to rent a spot as an authorized user on a stranger's account. The payment for the person allowing the piggybacking on his or her credit history depends on the quality of his or her credit line.
http://www.chron.com/disp/story.mpl/business/4865124.html
Huh?
How could owing more money for someone else's bills help your credit?
Seems like getting someone else to pay your bills would help more?
Joe H
This article was in the Washington Post last weekend.
http://www.washingtonpost.com/wp-dyn/content/article/2007/06/05/AR2007060500040.html
Bill Koustenis
Advanced Automotive Machine
Waldorf Md
Edited 6/5/2007 9:25 pm ET by MrBill
Until now, I had never heard of this. I can envision fraud claims being asserted by lenders who rely on a credit rating that was "enhanced" this way. I can also imagine the purveyors of such schemes being less than careful with personal financial data. Would they tell me they had rented my card to a hundred people? I wonder what would happen to my credit rating if a hundred people showed up as authorized users on my Visa card.
I'm not surprised at anthing in the field of finance anymore. There was an outfit in NV that would rent people $100K to $1M for a month or so while they applied for a mortgage. That way their bank account looked flush and they could qualify for a much bigger loan and sign the papers without "lying".
This credit score stuff just shows how out of whack our lending system has become. Everything is compressed in time so no real background checking ever occurs, Appraisals are drive by, loan documents never get read, and banks bundle and unload the mortgages to overseas suckers as soon as the ink is dry.
"That way their bank account looked flush and they could qualify for a much bigger loan and sign the papers without "lying". "
isn't that called "being a general contractor"!
Jeff Buck Construction
Artistry In Carpentry
Pittsburgh Pa
Oh man Jeff, that was cruel! I actually had a GC for a neighbor but he moved to CA in '05. Bill collectors of various stripes soon were knocking on my door, and I got annoyed with their questions because other than chatting over the fence now and then, I really didn't know much about the guy or his whereabouts. Some of them copped an attitude like I was holding out on them. One really nasty "lawya" demanded to know when he'd be back in town. My answer was "When the statute of limitations expires" - he didn't like that.I don't envy the lot of most GCs. It's a hard way to earn a living.
That is pretty interesting. The way I run my company is that each man has a credit card that is in his name on my account. They all have maximum limits and are paid off every month. Sounds like they all get some credit score benefits from it. Maybe I can list it as a perk lol. DanT
sounds like way to bring in some cash i read about it and asked friend in mortgage company been going on a while, explained how the accounts can't be detected by the companies setting credit ratings, so they can only offer lip serice about not accepting it saves people big money in interest rate/ payments u have control of any credit card/ loan offers etc. that might generate as it goes to u, not the piggybackers they do not have critical info, and u remove stuff after their deal is completed as it's a one-shot deal it's legal to do this; if congress wants to stop it for the big bucks banking lobby, that will be somewhere down the road
I too have been reading a lot about this and even with the safeguards would never 'rent out' my credit.
However the DW and I did put our oldest daughter on one of our credit cards when she when away to college.
Long story short, after college she and I went new car shopping .
I told the salesman I would cosign to get the great fin. terms but did not want to be on title.
He said lets run her credit and see how it looks. He comes back and says OK she's good to go, no need for cosigner, she has excellent credit.
You guessed it. Mom and dad's credit card on the top of her report.