How Piggybacking Helps Improve Credit Scores

There is no doubt about it; credit scores definitely play a major role in the financial status of any person these days. This is precisely why more and more ideas of improving credit scores are popping from just about anywhere and everywhere. One such idea is known as “credit renting”, which is also popularly known as “piggybacking”.

So, how does credit renting work exactly? It works pretty much like you transplant the “credit DNA” of people who have great credit histories into the credit histories of the users who are not doing so well in the industry. Companies that do this arrange for the improvement of their clients’ scores by adding these clients as authorized users of the cards of people who have excellent credit standing and history. Of course, these people who have great standing are paid to add these less fortunate people as authorized users of their cards. Basically, this works similarly with renting and leasing.

Statistical figures show that the FICO credit scores of these authorized users actually rise by at least 50 points, and even as high as 250 points. This is great news for credit users who have not been lucky enough to have high credit scores to begin with. Now, you do have to look for a credit user who has a FICO score of at least 700. This way, you are sure to have a fruitful 2-way relationship. This is because the positive details that are contained in the credit report of the owner of the account would then be plotted into your own credit report.

How effective is this, you may ask. There have been a lot of success stories when it comes to credit renting. One such case is a credit user based in Florida who paid close to $2,000 for 3 credit card spots. This means the Florida user paid 3 credit cardholders of exemplary status so that he would become an authorized user of the cards. In less than 2 months, his FICO score made quite leap from just 550 to 715. What’s even better about this is that because of this leap, he was then able to close out his own mortgage with an APR of just 7.5% - and with no down payment.

Credit renting is certainly a feasible option that credit users should consider, given that there is no limit to the amount of authorized users you can have. Also, the authorized users do not have to be related to you in any way. Thus, it would really bring forth a symbiotic relationship for both the owner of the credit card account and the person renting to become the authorized user in the deal.

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