Released: April 07, 2007

Credit scores for sale

Source: Kenneth R. Harney, Washington Post (Free Registration)

When your credit scores don’t qualify you for the home mortgage you want, where do you turn? That’s an especially timely question now, as lenders tighten underwriting standards for applicants with less than perfect credit.

But federal and state authorities fear that some borrowers are turning to a fast-growing business on the Internet: companies that claim to boost credit scores by transplanting the credit DNA of people with excellent payment histories into the credit files of people with sub-par histories, ostensibly without breaking any law.

The companies claim to raise FICO credit scores by 50 to 250 points, or more, by adding low-scoring borrowers as “authorized users” onto the credit card accounts of people with FICO scores higher than 700. The positive payment information from such cardholders then flows into the files of the people with sub-par credit.

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