FICO RULES HAVE CHANGED

New FICO rules are raising havoc with married couples as well as with partners and live-ins.. For years it has been common practice to include one’s spouse as an authorized signatory on the other spouse’s credit cards.
At first blush, it seemed so romantic - signifying the oneness of our union. Then it became a practical matter. Put the spouse on the gasoline credit card so each could purchase fuel for his/her car at one’s leisure. Then it was extended to department credit cards so clothing and other household purchases can be made by the one who usually shops for those items. After all doesn’t that spouse has more time for that sort of thing. Besides it is so much more convenient to write just one check every month
Now with many department stores doing away with their own individual credit card (Target being the latest), why not put the spouse on the VISA or MASTERCARD, since they are more universally accepted whenever and where ever one shops. In that way the number of cards being carried can be reduced hereby reducing the risk of being lost or stolen. Good sound thinking and practice. After all - we are one union
At this point enter FICO and the rules change.
With the advent of the Credit Society, it became necessary to have a central source to determine the creditworthiness of an individual applying for credit. What is that applicant’s credit history? The 3 big credit reporting agencies entered the scene and fulfilled stop gap measure. But who has the time to examine a lengthy though accurate report when the needs of the customer who is in front of me must be served before he decides to take his business elsewhere. Now if there were some simple mathematical figure that could represent the financial history of a potential customer and consequently the financial risk to a lender, instant decisions could be made which were reliable. The Fair Isaac Co grasped the opportunity and FICO enters the scene.
But as always, someone is bound and determined to beat the system. Part of the American Dream is owning your own home. But how sell a home to someone who has a low credit score. To deprive that someone of the American Dream is un-American.
I’ll build houses but only if you can buy So there arose a new market - those with excellent credit (for a fee, of course) could rent their account to one with a low credit score - make them an authorized signatory. The one with the low score realized the American Dream. The person renting his account received a fee, the housing market boomed, the economy flourished, unemployment was reduced. Everyone was happy. It appeared to be a WIN - WIN situation. Then the bubble burst and foreclosures became common.
FICO changed its rules again and tightened up on renting out one’s account (known in the trade as piggybacking...) Well intended but the innocent also suffer. Remember that spouse who thought it was romantic to put their spouse on their account. Suddenly the spouse put on another’s credit card has no individual credit despite a history of timely payments, etc. And in a time of financial crisis, credit is only granted on one’s individual credit history. No credit history - no credit. What’s a spouse to do????