New FICO Changes Might Cause Lower Scores

Many changes are coming soon regarding the way your FICO credit score is calculated.

One of the biggest changes is the removal of authorized user accounts from the credit scoring calculation. This credit repair tactic has recently come under fire for its use in defrauding mortgage lenders. As a result, consumers will no longer receive points on their FICO score for being an authorized user on someone else's account.

Who'll be affected the most? According to Credit.com, 60-75 million people will be affected by the change, mostly young people who use their parents' credit cards to start building their own credit history and people who are trying to rebuild their credit by using their family members' good credit.  By not having this account considered these credit histories will be shortened and remove possibly remove many years of positive payment history from their credit score calculation. Since payment history is 35% of the credit score and length of credit history is 15%, their credit scores will likely drop. On the other side of the coin, there's always that possibility that the result could be positive for some. If someone is an authorized user on an account that has several delinquencies and a high balance, they might see a slight boost in their credit score.