Duke5150

'Piggybacking' roils credit industry
By J.W. ELPHINSTONE, AP Business WriterSun Jun 3, 4:46 PM ET

Only a low credit score stood between Alipio Estruch and a mortgage to buy a $449,000 Spanish-style house in Weston, Fla., a few miles west of Fort Lauderdale.

Instead of spending several years repairing his credit rating, which he said was marred by two forgotten cell phone bills and identity theft, the 37-year-old real estate agent paid $1,800 to an Internet-based company to bump up his score almost overnight.

The result was a happy ending for Estruch, but the growing practice is sending shivers through the mortgage industry. Federal regulators are also reviewing the practice. And after being contacted by The Associated Press for this story, Fair Isaac Corp., the developer of the widely used FICO score, said it will change its credit scoring system beginning later this year in a way it contends will end this little-known but potentially high-impact mortgage loan loophole.

The full article can be found at:

http://www.latimes.com/business/la-f...ck=2&cset=true

Kagehitokiri

wow, i thought most of those "credit repair" things were scams

very interesting.

too bad i didnt hear about this (as a source of income rather that credit repair) sooner. ill bet some people on FT have been doing it, but didnt say anything, in order to keep it going as long as possible. now it sounds like the industry is about to start making changes.

biggestbopper

This is a scam, too. Only, the real victims are going to be the suckers who rent out their credit card accounts to "authorized users." Some AUs are going to get out there and start charging. Why not, they are not liable for the charges.

Kagehitokiri

what? they dont get cards.. those renting have all their personal info though.

bevoinva

I would think that this would be ripe for identy theft.

Kagehitokiri

latimes requires free registration, so heres direct AP link

http://hosted.ap.org/dynamic/stories...MPLATE=DEFAULT

huh, it seems like the article was edited because i would have sworn they had a quote from kinney (lessor of authorized accounts) saying he had the lessee's name/SSN/etc so he COULD steal his identity if he wanted to. (obviously not smart because he would lose the source of income and they would know who did it)

but FYI

http://www.bugmenot.com/
http://www.poynter.org/article_feedb...t.asp?id=60149

libraries and google cache allow the same thing, it is only bypassing FREE registration, not a paid subscription like WSJ.

http://www.bugmenot.com/view/www.wsj.com >
although i think google cache does allow you to even read those that require paid subscriptions..