AUTHORIZED USER ACCOUNTS
Automated Underwriting Engines (Desktop Underwriter & Loan Prospector) will not take into consideration credit report tradeline’s in which the borrower has been designated as an “authorized user”. It is the responsibility of the DE underwriter to analyze credit reports containing “authorized user” accounts stringently.
If the AUS approval is based on authorized user account trade lines, lender must confirm these accounts accurately reflect the borrower’s credit history.
Authorized User accounts may not be used to satisfy the minimum tradeline or credit score requirements.
If the primary account holder is not another borrower on the transaction and our borrower’s credit report shows numerous “authorized user” accounts, it may indicate that the report is not an accurate reflection of the borrower’s credit.
In many cases, the borrower has little or no credit as the primary borrower and when the authorized user accounts are discounted, the borrower does not generate a credit score, which is required by all investors.