How Being an Authorized User Could Boost Your Credit Score

By Jason Steele
Reviewed by: Lauren Bringle, AFC®
Published on: 04/24/2019

Everyone wants to have good credit, but sometimes that can be a challenge.

The biggest issues you may face can be a lack of credit history or a record of missed payments. And if you have bad credit, it can be very difficult to qualify for a loan or other credit account in order to prove you're financially responsible.

Maybe you’ve heard about how authorized user accounts can help your credit score (you might have heard it referred to as "piggybacking", for example. There’s some truth to this idea, but it’s not as simple as it might sound.

Let’s take a look at what it means to become an authorized user and how it could help your credit score. We’ll also explain how to make someone else an authorized user on your card to help their credit.

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What is an authorized user?

An authorized user is a person who makes charges to someone else’s credit card account. The person who applied for a credit card and was approved is considered to be the primary credit account holder, and he or she is able to add authorized users to the account, usually at no extra cost.

The individual with the authorized user account will receive a credit card with their name on it, and can use it to make charges. However, an authorized user is limited in what they can do with the account. For example, authorized users can’t make balance inquiries, request a credit line increase, redeem rewards or add other authorized users.

Also, an authorized user isn’t responsible for repayment of charges. The primary account holder is always responsible for payment of those monthly billing statements, including any account activity made by the person on the authorized user account. At the same time, the primary cardholder will also receive all of the rewards offered by the card company, such as points, miles or cash back.

There are few effective limits to the number of people you can add as authorized users to a single account. For example, American Express allows up to 99 additional authorized cardholders per account.

Why are people added as authorized users?

There are several reasons why someone might add an authorized user to his or her account while building credit. For example, you might wish to add your spouse, parents or adult children as authorized users to your account, so they can make purchases you will pay for.

Small business owners frequently add their employees as authorized users to their business credit card accounts, so that they can easily make company purchases. Authorized cardholders may also receive certain cardholder benefits when traveling, such as a free checked bag or even access to an airport business lounge.

In addition, you can add someone as an authorized credit card user in order to help them build credit. Just note that some credit card issuers have minimum age requirements for becoming an authorized user.

For example, American Express has a minimum age of 13, Discover 15 and US Bank 16. However, Bank of America, Capital One, Chase, Citi and Wells Fargo don’t have a minimum age to add additional authorized cardholders.



What is the difference between a joint account holder and an authorized cardholder?

Joint account holders are two people who are both primary account holders. Both people apply for the account together and both are individually responsible for repayment of the balance. That means that if one person fails to pay his or her share of the balance, then the other joint account holder must still pay the entire balance.

The account information for a joint account is reported on the credit histories of both joint account holders, and can affect both of their credit scores. While joint accounts used to be common, there are now very few credit card issuers that allow people to apply for one. The largest exceptions are Bank of America and Wells Fargo.

Joint account holders both have access to all the functions of a primary account holder including balance inquiries, credit line increase request, redeeming rewards and adding other authorized users.

In contrast, an authorized user does not apply for a credit card with the primary user, and can only be added later at the request of the primary user. Authorized users also have little authority to manage an account beyond making new charges. The vast majority of credit card issuers allow the primary account holder to add authorized users to an account, usually at no extra charge.

How being an authorized user can affect your credit score

Your credit history contains all the credit accounts you’ve opened, and it can also include accounts where you are an authorized user. Some, but not all, credit card issuers will report account information to the credit reports of authorized users. To find out if the account information for authorized users is reported for your card, you’ll need to contact your credit card issuer.

When the card issuer reports account information for authorized users, it will affect the credit reports and credit scores for each additional cardholder. If the primary account holder makes his or her monthly payment on time, and has a good credit utilization rate, then it will add to the authorized user’s credit limit and positive payment history, and could improve their credit score.

But if the primary account holder carries a high level of credit card debt, if their credit utilization is too high or they miss credit card payments, then, depending on the credit scoring model, it can add negative information to the credit reports of the authorized cardholders, and hurt their credit scores.

The VantageScore 3.0 model only includes positive information from authorized credit card users, but the more frequently used FICO score includes both positive and negative information from authorized users.

Does having authorized users affect the primary account holder’s credit?

Adding additional authorized cardholders to an account doesn’t have any direct effect on the primary account holder’s credit history or credit score. But if an authorized user makes charges that the primary account holder isn’t able to pay off, then it can add to the balance of the account and hurt the primary account holder’s credit score.

Who should I ask to add me as an authorized user?

If you’re trying to build credit by becoming an authorized user, there are several different things to look for first:

Someone who has excellent credit. First and foremost, you’ll want to find someone who has excellent credit, as being an authorized user on an account of a person with bad credit can hurt your score.

Someone who’s responsible with credit. Specifically, you need to make sure the primary account holder will manage the individual card account responsibly. That means they always pay their bills on time, carry very little credit card debt and keep their credit utilization ratio low.

Someone you have an actual relationship with. The person should be a family member or a very close friend, and you should never pay someone to become an authorized user on their account. In fact, FICO has taken steps to deter people from paying others to become authorized users just to increase your credit score.

This process is sometimes called piggybacking, and FICO will try to analyze its data to see if you have an actual relationship with the primary cardholder, or if you may be paying them to piggyback on their credit. If FICO determines that you are paying to piggyback, it may not include the positive account information.

Someone who’s willing to add you as an authorized user. Remember that the primary account holder will always be responsible for the repayment of all charges made by any authorized cardholders. This is a serious responsibility that the primary account holder accepts every time they add an authorized user.

But if the only reason you want to be an authorized cardholder is to help your credit score, then you could propose that the primary cardholder keep the authorized user’s card in order to ensure that no charges are made to it. That way, you can build credit without risking the possibility of overspending.

How to add someone as an authorized user

Adding an authorized user on your credit card user is a quick and simple process. Nearly all credit card companies allow the primary account holder to add authorized users to an account, usually at no extra charge.

However, there are some premium reward cards that impose an additional fee to add authorized cardholders. For example, the American Express Platinum card charges an additional $175 annual fee to add up to three authorized cardholders while the Chase Sapphire Reserve charges $75 per year per additional cardholder.

Many credit card issuers allow you to add additional authorized credit card users when you apply for your account. But if your account is already open, the easiest way to add an additional authorized user is to login to your account online and make the request there. Alternatively, you can call your card issuer and make the request through a customer service representative.

Either way, you’ll be asked a few simple questions about the additional authorized credit card user. Usually, you’ll need to supply the user’s name, date of birth and Social Security number.

However, some card issuers don’t even require this information. Nevertheless, you’ll want to make sure the user’s Social Security number is included in order to be sure the account’s information is report on the authorized user’s credit history.

Expect to receive the authorized user’s card in the mail at the address of the primary cardholder. Like any new credit card, you’ll have to verify that it’s been received before it can be used. You can also link the card to the authorized user’s login with the bank or credit union that issued the card.

How to remove authorized users

Primary account holders have the option of removing additional authorized cardholders at any time. In fact, the process is even easier than adding one. This can be done with or without the knowledge or consent of the authorized user.

As a primary account holder, you can contact your card issuer and simply request to remove the additional user. Their card will be disabled immediately and no new purchases can be made with them. The users should then destroy the cards.

In the case of metal cards that are difficult to destroy, the card issuer will provide a return envelope. And just like adding an additional authorized cardholder won’t directly help or hurt the primary account holder’s credit history or credit score, removing authorized cardholders won’t have any effect either.

But if you are an authorized user, can you remove yourself? Maybe, as some card issuers will allow authorized users to cancel their own cards. However, there are other banks and credit unions that only allow the primary cardholder to remove any authorized cardholders.

What happens to your credit after you are removed as an authorized user?

Once you’re removed as an authorized user, the account may be removed from your credit history. If that happens, any effect the account had on your credit score will be reversed. If the account still appears on your credit report, you can ask the three major consumer credit bureaus to have it removed.

This is an action you may want to take if the account isn’t being managed responsibly. If the account has a high amount of debt, or has a record of late credit card payments, then it could damage your credit history and lower your credit score. But unlike the primary account holder, authorized users can simply have the account removed from their credit history upon request from the credit card company.

Becoming an authorized user is one option

Becoming an authorized user is a lesser known way to help boost your credit, but it can be a valuable one. By understanding how to become an authorized cardholder, and how it affects your credit score, you can decide if this method is right for you.

For an alternative to piggybacking credit, see our guide to secured credit cards.

About the author

Jason Steele is a leading expert on credit cards. His work has been featured on Business Insider, MSN Money and Yahoo! Finance, as well as on The Points Guy.

About the reviewer

Lauren Bringle is an Accredited Financial Counselor® with Self Financial – a financial technology company with a mission to help people build credit and savings. See Lauren on Linkedin and Twitter.

Editorial Policy

Our goal at Self is to provide readers with current and unbiased information on credit, financial health, and related topics. This content is based on research and other related articles from trusted sources. All content at Self is written by experienced contributors in the finance industry and reviewed by an accredited person(s).

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Written on April 24, 2019
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