Credit history refers to an individual's past behavior involving the taking out and repayment of loans and the use of revolving credit, such as credit cards. Credit histories are recorded by national credit reporting companies who issue credit reports. These reports are used by lenders to assess an applicant’s creditworthiness.
FICO scores measure borrower credit risk and are commonly used by mortgage underwriters when originating loans on owner-occupied homes. The score is based on the applicant’s credit history and credit usage patterns, expressed as a number between 300 and 850. This score determines loan approval and terms offered.
Piggybacking is a strategy used by individuals with poor credit histories to improve their credit scores by being added as an authorized user on the credit account of someone with a good credit rating. While it can temporarily boost a credit score, the practice is of dubious legality and may defraud lenders.
