Authorized Users Can be Good & Bad

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Readers frequently email to ask about the impact of being an authorized user on someone’s credit card.  There are several benefits and drawback to being an authorized user so let’s have a look!

Authorized VS. Joint Users

An authorized user is someone who can run up charges on a credit card on your behalf.  An authorized user is usually not personally liable for the charges on the credit card, but the primary card holder is liable for those charges.  So only add someone whom you trust as an authorized user.

You can usually add an authorized user by calling the customer service number at the back of your credit card.  Some banks will let you add an authorized user online or when you apply for the card.

On the other hand, a Joint User is equally liable for the charges on the credit card.  And a Joint User usually CANNOT get the credit card sign-up bonus for him or herself again (unlike an authorized user who can get the bonus separately).

Advantages of having an Authorized User

1.   Help Complete Minimum Spending

Having your partner as an authorized user on a credit card accounts means that any spending on the card counts towards your minimum spending requirements and that you get the miles and points earned for the authorized user’s spending.

Because two are better than one: an authorized user can help the cardholder reach minimum spends faster.

For example, if Emily has me as an authorized user on her Chase Sapphire Preferred card, she will earn the points for the spending which I do.  So we don’t need to switch the Chase Sapphire Preferred card between us.

2.   Can Get Sign-Up Bonus on Your Own Later On

An authorized user won’t get the sign-up bonus for being an authorized user on someone else’s card because only the primary cardholder gets the sign-up bonus and the miles or points for spending.

But the authorized user can apply for the card in his or her own name, later on,  as the primary cardholder and get the sign-up bonus.  In this way both you and your partner can get a credit card sign-up bonus.

For example, I won’t get the sign-up bonus for being an authorized user on Emily’s Chase Sapphire Preferred (only she will).  But I can apply for the Chase Sapphire Preferred and get the sign-up bonus myself!

3.   Potentially Improves Authorized User’s Credit

If the person who adds you as an authorized user has good credit, your credit score may get a boost.  This is especially true for partners/children who don’t have long credit histories.

Usually, the credit line will appear in the authorized user’s credit report even if you don’t give the bank your social security number or other personal information.  But there isn’t a credit inquiry on the authorized user’s credit report.

If you’re a student or stay-at-home mom, with no income and credit history, being an authorized user will usually help establish your credit history and could improve your credit score, provided the primary card holder has good credit.

The payment history for the card will be reported on your credit report.

4.   Additional Bonuses

In the past, banks would offer bonus miles when an authorized user was added to the account.

They have since scaled back and one of the few credit cards to offer such a bonus are the Bank of America Virgin Atlantic card & United Explorer cards

Disadvantages of having an Authorized User

1.   Liable for Authorized User’s Spending

The primary cardholder is responsible for all the charges of the authorized cardholder.  So make sure you only add folks whom you trust as authorized users!

2.  Spending Close to Credit Limits

Your credit score drops a lot as you approach the credit limit on your credit card.  Having an authorized user who spends on the same credit card makes it easier to approach your credit limit.  Some banks will let you set a limit to what the authorized user can spend on the card.

I try to keep the overall balance on any credit card less than 30% of the credit line.  I sometimes do exceed 30%, but I then pay off the balance online the next day.

3.   Potentially Decreases Credit Score

The primary cardholder’s credit score can decrease if the authorized user maxes out the credit limit on the card or makes charges which the primary user can’t pay.

The authorized user’s credit score can be negatively impacted if the primary card holder fails to make their payments on time or maintains high balances on their account.

Bottom Line

Adding an authorized user can help you complete the minimum spending requirements.  But be sure that you can trust the authorized user with the card since your credit score is at stake!

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76 responses to “Authorized Users Can be Good & Bad

  1. I think there are two more advantages of being/having an authorized user you may want to include in your analysis.

    1) Amex deals, such as Small Business Saturday, Amex Sync offers, and Amex Twitter offers. Every single authorized user is entitled to the deal so when a gimme deal comes around, which basically means free money/points, more authorized users = more Amex cards to multiple the rewards.

    2) When you have a spouse or significant other who does not want to take part in the miles/points collecting game but allows you to manage their credit card portfolio. I’ll provide one example. I have both a Chase Freedom Visa and a Chase Freedom Mastercard so when the quarterly drugstore 5X hit, I was able to get $3,000 worth of VRs at CVS. My fiancee refuses to go to CVS and buy VRs and since CVS checks ID before letting you buy VRs, you’re sort of out of luck UNLESS you get your spouse or significant other to add you as an authorized user! All of a sudden, you have a card issued in your name under their account, and now you can go back to CVS and take advantage of another $1,500 worth of VR spend per Chase Freedom card. I realize this may not apply to everyone, but my mother also will not take part in miles/points collecting but lets me manage her accounts so the more people in your family like this, the more this becomes a big advantage.

  2. This is totally off topic, but your point about helping stay at home parents build up credit reminds me of an issue that is always on my mind…
    I have plenty of great credit history and some great miles/points cards, but I’m also a SAHM who now has zero income of her own (well, a few hundred dollars a year from Craig’s list/eBay). With even a high credit score can you get miles/points cards if you list zero as your income?

  3. If you are the authorized user, do you get all the perks of the credit card? For example, rental car insurance, lounge access, loss prevention, luggage insurance, etc.

  4. @Jamie I always choose “homemaker” as my profession, and I list our household income. Even when I’ve called reconsideration that hasn’t been a problem (except with US Bank–and I really want that Club Carlson card!). I do have a very long credit history, which I’m sure helps.

  5. Jamie,
    Same here. I list household income as mine. Never had a problem.

  6. @Jamie: I agree with Rachel and Anne. Also, it looks like the Fed or Congress is about to take care of this scenario, it’s definitely on their radar– stay tuned.

    Another potential negative: It seems that adding an AU has been the trigger for some Amex F/Rs.

  7. I had my wife add me as an AU on 2 of her retail CC’s opened in 1984/1985. Doing that increased my average age of accounts. Even with moderate CC churning, my scores do not drop as much as before. Those two AU’s keep my scores fairly high in spite of alot of activity. (3 mortgage refi’s, pay off of a couple mortgages selling a rental house and over 10CC’s in the past 9 months).

    My wife has a perfect pay history, low utilization & consistent use. She only uses the Macy’s card when she uses a 20%off coupon that requires using the Macy’s card. For non discounted cosmetics, I have her use one of her other cards. (especially if we need to make min spends!!)

    I have a deep

    • @Wedding Spend – I agree and I’ve mentioned being able to manage someone else’s accounts before, but didn’t include it in this post.

      @Jamie – You may be able to include your household income or a certain portion of it in the “other” field as Rachel and Anne point out!

      @Michael
      – You don’t get the free bags and mileage rebates. You may get the baggage insurance etc. but it varies by card so you’ll have to read the fine print with each card.

      @J – I believe those FRs happened when folks added lots of authorized users to max out the Small Business Saturday benefit. Adding one or two users shouldn’t be an issue.

      @chemist661 – Having such a long history is definitely advantageous.

  8. To finish the above posting:

    I have a deep, diverse credit history.

  9. @MMS: Ah, good to know, thanks for the info!

  10. Will being added as an authorized user to a chase card cause the credit limit on the authorized card to be calculated as part of the credit that chase is willing to extend you? If I am already close to the limit with chase I don’t want my wife to add me because I’m planning on applying for a new chase card in the next month or so, but if not it would make it easier to meet minimum spend.

  11. Hi are there any cards that an authorized user can extend their history by adding themselves on to your credit card if you have a longer credit history?

  12. Hi! I’m not certain you answered TW’s question. I think he means the other way around, which is also my question: I have 10K credit w/ chase, my wife has 5K w/ chase. She adds me as an authorized user. Do I now have, in chase’s eyes, 15K credit w/ chase? Possibly putting me close to the total credit limit that chase is willing to extend me?

    • @NAFNAD2 – Not sure I understand the question, but if someone adds you as an authorized user to their credit cards and if they have a long credit history and good score, you should benefit.

      @Eric Coffman – Your wife is responsible for the 5K (even if she adds you), so I’d guess that it shouldn’t impact your limit with Chase.

  13. Don’t forget it can cost you $$ to add an AU at least for the American Express Business Gold. The first AU card that is. American Express will generally waive the AU charge the 1st year. For my wife’s Business Gold Card, the $175 fee is waived and the AU fee of $50 was waived as well. Make sure you pay attention when the following year comes around. I’m assuming if you cancel the main card the AU card fee is auto cancelled as well. Also, you may be able to keep the main card, pay the $175 or negotiate, and cancel the AU card outright. I believe Chase doesn’t charge for AU cards.

  14. In order to quickly build a child’s credit history, is it better to add them to my account as an authorized user? Or is it best to set up a secured CC in the child’s name?

  15. Rachel. Anne, J – thanks! That’s what I’ve been doing thus far, but have only applied for 3 cards and had instant approval for all. Glad to have a few more data points that I can stop worrying and keep on churnin’

  16. This has given me an idea for getting some credit history for my 23 year old son, who hasn’t been able to get an unsecured credit card yet. (And I will not cosign for one.) I will add him as an authorized user on one or two of my cards, but not give him an actual card or access, then hopefully in 6-12 months he will qualify for his own credit card. Does this sound like a good idea?

  17. Have a really close friend that went through a nasty divorce whose ex-husband drove her into bankruptcy. She is starting from ground zero essentially financially. Could I add her as an AU, never give her the card and help increase her credit score? I should mention I have 800+ credit score, have had this card for several years, use it for everything and pay off the balance in full each month.

    What are the potential downsides of this idea? Again, I would have complete control of the card….so I am not concerned about any unwarranted charges.

    Thanks!

    • @jason – It isn’t clear what the credit score impact is if you add a non-family member. Also, your credit may impact hers i.e. if you miss payments (not saying that you will), but that could have an impact on her credit.

  18. I had been looking for explanation about this concern for long, but now I’m so happy.

  19. I was recently added to my fathers Discover Card as an authorized user, March 28th to be exact. It still has not shown up on my credit reports. how long dos this usually take and should I send them a letter requesting it be reported? I was added ot help establish credit history… really hoping this helps!

  20. Darius, it seems all the questions had been about the authorized user. I have good credit and want to add my gf as AU, but what is the impact on my credit score if she do not have long history and her score is not that good? Thanks!

  21. Hello. I’m on a money management program now for my credit cards. I made a mistake by closing my card that have credit history of 8 years. Will I still be able to rebuild my credit history as an authorized user on my sister account?

  22. Hi there. I got the Amex Biz Gold with 75k points after $5k spending. My wife and I have 2 separate Amazon payment accounts. I am thinking of adding her as an authorized user and get her an extension card. My question is do you think it’s wise to use Amazon payments on both my card and her extension card considering it is just one credit card account, or would that raise a red flag on Amazon. I usually send Amazon payments to my wife and my wife to another person. My wife does not carry my last name and she registered her Amazon account to my sis-in-law’s address where we used to live.

  23. Daraius,

    For many years I’ve been an authorized user on a Chase card for which my father is the primary cardholder. I seldom use this card.

    I’d like to apply for the same Chase card myself (to get the sign-up bonus). Would my father need to cancel the other account (the one on which I’m an authorized user) before I can do apply (as the primary cardholder), or am I allowed to have two of the same credit card (one as the authorized user, one as the primary cardholder)? (Obviously, the account #s attached to these cards would be different.)

    • @Actie – Your father wouldn’t need to cancel the account if you want to apply for the card. You can have 2 versions of the card – 1 as an authorized user and 1 by yourself.

      @Mike – It depends, but should be reported in a few months.

  24. I also have the same question as Kristi above but a slightly different circumstance. Would love to here the response.

  25. i was going to add my bf to my cc as an au so he can build credit. i am wondering i usually pay my bill in full however one month i had an emergency and i charged almost the total available, will this show on his credit even if it was done before i add him? Also, does the rest of my credit history affect him or just the card i put him on, because i had a bk 3 years ago. i hope this makes sense.

  26. In April I recieved a Discover card and added my boyfriend as an AU, unaware it impacted his credit. He checked his credit report and the card showed as a revolving credit acct, helping his low 570 score! He is not a primary holder of a cc, but has 9 years of credit history from student loans, a closed store card, and two closed car loans. Would it be pointless for him to open his own card with a small limit to improve his score, or is being an AU equally helpful? (Provided i make the payments.) We want to make sure he shows he can make payments evn though he isnt the primary, and that future lenders will view an AU as sufficient credit history. Hope this makes sense, thank you!

    • @noelle – I’d do more research and ask that question on creditboards.com

      @Biz – Getting his own card, charging a small amount each month, and paying it off in full will improve his score more than being an authorized user.

  27. With a credit score over 800, would it matter which card to add an authorized user on? Should it be my oldest card that has no bonuses but 15+ years old? or just the churning card that has the best benefits (even though I plan to close it before the yearly fee)?

    Also, if/when I do close a short history card that I have an authorized user on, would that hurt the authorized user’s credit score?

    Most of the drawbacks I read are only in reference to the person adding an AU. What are the drawbacks for the person being added?

    Thanks

    Thanks

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  29. My mother and I were wondering if she added me as AU on her Chase Freedom would it show on my CR. We do not have the same address and I have heard that that wont ask for my SOS. I have seen various answers to this question.

  30. Well she added me and it shows on Equifax. I wonder if it will show on EX and TU…only time will tell!!!

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  34. If I add my girlfriend as an AU on my Chase Sapphire Preferred card, will she get a Sapphire UR account as well? She has a ton of UR points from her Freedom card that we would like to be able to transfer to Southwest points, so it’d be nice if she was able to get a Chase Sapphire UR account. My brother also has the same thing.

  35. Thanks for the quick response!
    I know you can’t randomly transfer UR points to other people, do you think Chase would have a problem though if she was an AU? She’s in school right now so she probably won’t qualify for the Sapphire

  36. Hi Daraius!—In the same vein, I have a related question as it pertains to small businesses—maybe you could help.
    My husband and I have one small business under my name. If I were to add my husband’s name to that business, would he then be able to also go out and get his own versions of business credit cards I already hold for that same business? Or can there only be one card type issued per business? I.e., they’d tell us we could only add him as an authorized user to the business cards I already hold for that business…
    I mainly ask because we’re thinking of embarking on another business venture and I’m contemplating whether to put it in his name so that he can get in on some business cards. But if it doesn’t matter then I may change both businesses to be under both of our names.
    Just wanted to get your insight…Thanks!

  37. Does this count against your average age of cards? Or considered a “new” account on the report? Because a “new” account could hurt chance at upcoming applications, especially churning Barclays US Air card.

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  39. hi,

    i was interested in hearing the answer to kristi’s question, about how long it would take for amex or discover to show up on my credit history if i am added to a parents card. i only want to be added as an authorized user if it will help give me a credit history.

    thanks in advance.

  40. I am an authorized user on a credit card with a $24,000 limit as well as a $15,000 limit. However, I only have one credit card of my own (credit card on which I am the primary cardholder) and my credit limit is $700. I was wondering if the credit limits on the accounts on which I am an authorized user count towards my “total credit available” in my “credit utilization ratio”. In another words is my total credit available $39,700 or just $700? I was trying to decide how much I should use the card to establish a good credit score. If my total credit available is $39.700 then I was thinking about spending $690 out of $700 on my personal card every month and paying it off on time.

  41. Can I add a minor child as an authorized user? so the child can reserve hotel rooms when traveling with parents? I am thinking about the lifetime Hyatt Diamond Status, it will be a great gift to the child.

    • @Anthony – Credit boards is a better resource for those specific questions.

      @Amy – You may be able to add a minor as an authorized user. But I don’t understand the lifetime status with Hyatt because you also have to earn a lot of points before qualifying for lifetime Hyatt Diamond status.

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  43. Been trying to figure this one out: I did an AoR in October, and added my wife as an authorized user. Should she wait the customary 3 months to do her first AoR or is that rule of thumb not applicable when talking AUs?

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  45. Thanks so much for the awesome information. My question is this. Can the credit card company cancel the card / account if the authorized user I add has really bad credit with collections and or bankruptcy showing up on his credit report ? And, is the authorized users information factored in when making the credit decision to issue the card ?

    thanks again

    • @mb gold – I’d ask your question on credit boards.com. The authorized users information is usually never factored in when deciding to approve a card. You can get approved for a card and then add an authorized user to the account.

  46. I have been an authorized user on my husbands BA Visa and recently applied for the card for myself and have already put about $5000 on the card and planned on spending all $30,000 for the travel together ticket. However I just received a letter from Chase that because I have already had the card I won’t be receiving the sign-up bonus. What should I do?

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  50. My nephew added me his chase freedom credit card to get $25 rewards with out ssn# but… chase script system found my credit report and they added authorized card on my credit score. I had 13 credit cards now it is 14 cards. my credit score is excellence. I do not want authorized credit card. If he cancel me authorized user how my credit score will affect? PS: 1 month reported on my credit score. now maybe second month will be soon and positive. but I do not want to get any risks. will chase remove the card my score or they will stop reporting after he removes my name. thank you

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  52. Being an authorized user of my husband’s credit card, should he pass away, what will happen to my ability to continue to use credit card?

  53. If I am an authorized user on my husband’s CSP, can he refer me for a card of my own and receive the referral bonus?

  54. I also was added to my boyfriends cc around March or April how long will it take to have an impact on my credit score? I haven’t seen a thing yet

  55. My father is going to add me to his credit cards from is bank and I owe money to the creditunion he uses will that keep me from being a AU or will he have to pay the balance that I owe