I’ve heard mixed responses for this, but if I am an authorized user on my Dad’s credit card which I never use will I be able to write an LOE for this or will my MC count it towards my DTI since it is on my credit report? I am trying to figure out if I need to be removed from the card before my ATD event on 8/9. I am hesitating because I know it will impact my credit score.
People are always concerned about their credit score which means nothing to naca. Paying your mortgage on time for 6 to 12 months boosts your credit score 20 points above where it was before you closed the credit account.
Hi Nelson, To clarify I am not worried about my credit score when it comes to NACA as having a high credit score is beneficial for other qualifications outside of a home loan. My question is whether the MC will use that info for my DTI ratio or not. If so I will need to be removed.
I don’t have an answer for you. But I can say if you plan on using your credit score to take advantage of other loans before you close on your house regardless of whether it’s through naca or not then you will be jeopardizing your home loan since the general rule of thumb is don’t take on new debt apply for loans or credit cards while getting ready to buy a house.
My advice is don’t remove yourself as an authorized user. The MC will to let you know if it is an issue or not. I too am an authorized user on my father’s credit card. I had to show that the credit card balance was at $0. I had my father request a balance letter from his credit card company stating that the balance was at $0.
I know each persons situation is unique. For me, the credit card in question had an extremely low balance and I had been an authorized user for over 10 years. So in my case, it wasn’t a problem. I didn’t have to be removed as an authorized user. I have been NACA qualified and is in the housing search phase.
I do believe if it wasn’t at $0 balance it would have to be considered as part of my debt.
I hope that helps. It feels so good to be able to help people with questions they may have. <3