Your Authorized User Rulebook

Ok, if you are lucky to have a trustworthy person to add you as an authorized user and share their good payment history (35% of your score), credit utilization (30% of your score) and length of credit (10% of your score) with you, TAKE A MOMENT AND GO THANK THEM REAL QUICK!!!

Earlier this year, I did a little experiment, I removed myself as an authorized user on my mother’s credit card to see the effect. To say the least, that was a huge mistake because, my credit score dropped over 138 POINTS!!!! I had lost 26 years’ worth of great payment history and that was my oldest account. I added myself back and had to wait for her statement date for my score to increase. It increased by 100 points to be exact. Again, if someone added you (including me) as an authorized user, go thank them! (Let me go thank my mother)

Even after successfully and legally deleting all negative information off your credit files, it is pretty rough to raise your credit score, get approved, and build positive payment history since you can’t go back in time. This is where becoming an authorized user (tradeline) comes in!

What is exactly being an authorized user?

Well, I’m glad you asked, love! Being an authorized user on someone else’s credit card means that you have the option to have your own card, make purchases on the account, BUT you are not responsible for making payments. Hence, you must be a trustworthy person!

What is the ideal account (tradeline) to be added as an authorized user on?

One that has a long history (I say 4 years or more), a low credit utilization, a high credit limit, and 100% positive payment history. On the statement date of that account (tradeline), the creditor (bank) will report that account (tradeline) to the credit reporting agencies (Equifax, Experian, and TransUnion), and it will appear on your credit files. Which will help boost your credit scores in order for you to qualify for your own accounts (tradelines).

What are the cons of being an authorized user?

Like most things in life, there are cons! However, the only con of being an authorized user is that your credit will be impacted if the primary account holder doesn't keep up with their on-time payments and their low utilization.

In the event of the account starts to hurt your file instead of helping it, you or the primary account holder can contact the bank and ask to be removed from the account and delete the tradeline from your credit files.

Ok love, remember to always monitor your credit reports.

Have a great week and talk to y’all next Monday!