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Credit Rating Scam in America

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  • 04-06-2007 1:13pm
    #1
    Macca206
    Closed Accounts Posts: 181 ✭✭


    Ive just seen on CNBC that in America there is a major scam whereby people can pay to get added to someones credit card who has a great credit rating. As a result, as they are on this card their own credit rating improves greatly and as a result can get better mortgages, loans etc.

    There is no risk for the person who owns the card as the person added will never have access to it and so long as the card is paid off the credit rating will never be affected.

    I didnt catch the whole report and didnt completely understand it all but can anyone shine any light on it or give an idea how credit ratings work?


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    #2
    SoBe
    Closed Accounts Posts: 828 ✭✭✭SoBe


    wow i am sorry i missed that,credit ratings in the states are a very big thing,if you have a bad rating you will be paying mega $ in interest rates on anything from car loans to mortgages.

    lets say you have a credit rating of 500 or less (they use a scoring system there) its doubtfull if you would be able to get a mortgage at all.
    if its 540 or above there should be no problem getting a mortgage but the interest rate will be any where between 8-12% :eek: madness for a mortgage i know.
    i think if its 700 or above you should be able to get a mortgage with a rate of about 6%
    i have found out all this cus im currently in the process of buying a house there with my fiance.

    on a car loan if you have bad credit you will have to pay about 20-25% interest but if you have good credit it would be about 8-10 %

    its a mad system to be honest and if people are able to use someone else's credit card to change their rating then i guess fair play to them :D

    EDIT: dont know if this should be in the rip off ireland foum though ;)


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    #3
    Ruu_Old
    Closed Accounts Posts: 36,634 ✭✭✭✭Ruu_Old


    Never heard of that, you can be added to a card as an authorized user but that won't do anything for your credit. When applying for a card, you have to apply jointly and only then will that help your credit.

    Normally building credit in the US starts with opening a checking and savings bank accounts and then getting a small loan or secured credit card (you pay them $500 or more and that acts as your credit line). Continue to make at least the monthly payment on it and your credit rating will grow quickly.


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    #4
    Macca206
    Closed Accounts Posts: 181 ✭✭Macca206


    It must just be for the US credit systems then. It was basically a company set up (with director with impeccable credit history) who allowed peope to be added to his credit card. They then shared his rating (he didnt lose any of his) and it mentioned paying less interest etc. Was hoping some loophole may exist here but seems like it doesnt


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