Trend: Parents Opening Credit Cards in Kids’ Names

Cash-strapped parents are reportedly opening credit cards under their childrens’ names, according to CNN.

While it’s clearly not the right thing to do, some parents seem to have no place to turn but their children, especially after their own credit score is shot.

And because it’s so easy to do, what with their unprecedented access to their children’s personal information, the trend seems to be growing.

One college student told CNN that her father had taken out a student loan in her name without disclosing it – she found out later after her first credit card application was denied.

Apparently she’s stuck with the student loan and bad credit to boot.

Another example cited a father who opened three credit cards under his son’s name, and it wasn’t long before two were maxed out and all three were delinquent.

As a result, the child’s credit score dropped a staggering 150+ points, and could be in trouble for some time.

Typically, things work the other way around, with a parent co-signing with a teen or young adult to help them establish credit or get a loan.

For example, many parents designate their children as authorized users on their credit cards to help them build credit history.

But with times so tight and credit card issuers more hesitant to lend, everything seems to be out of whack.

If you ever get tempted to open credit in your child’s name, think twice, because it’s not worth ruining your child’s credit score and their chance of getting credit in the future when they need it most.