Adding An Authorized User On Credit Cards: A Guide

Building credit takes time, dedication, patience – and strategy. Becoming an authorized user on a credit card is a popular strategy you can use to establish, build or improve your credit. If you’re considering going this route as part of your plan to build credit, you need to understand what an authorized user on a credit card is, and then figure out whether this strategy makes sense for you.

What Is An Authorized User On A Credit Card?

An authorized user is an additional user on a primary cardholder’s credit card. Once their name gets added to the cardholder’s account, the credit card issuer can send the authorized user a card with their name on it. Because the authorized user doesn’t own the account, they’re not legally responsible for the monthly card payments – the primary cardholder is.

What Are The Responsibilities Of An Authorized User?

Just because you have a card doesn't mean you have to use it. Discuss how you plan (or don’t plan) on using the card with the primary cardholder. Even if you don't use the card, the primary cardholder's credit card usage can still affect your credit score.

You and the primary cardholder should set expectations around responsible card use before you make any purchases on the credit card. Discuss approaches such as limiting your spending or paying the primary cardholder by an agreed date for any charges you put on the card.

How Does Being An Authorized User Impact Your Credit Score?

Many people consider being added as an authorized user because they don't have a credit history or have a low credit score, and it’s keeping them from qualifying for their own credit cards or loans. If you and the primary cardholder use your cards responsibly, being an authorized user can help boost a bad credit score in a few months. However, a credit builder loan offers similar benefits if you can’t be an authorized user.

Your first step to becoming an authorized user should be to choose a primary cardholder who uses their card responsibly and has a reliable track record of on-time payments. If the primary cardholder's score goes down for any reason – like late payments or balances over their credit limit – so will yours.

Choosing someone you can trust is key. Building your credit history with an authorized user credit card is a good start. It should help you qualify for a credit card so lenders can see how well you can manage debt independently.

How Many Authorized Users Can Be On A Credit Card?

There is no set limit to the number of authorized users credit card companies allow on one credit card. The exact number will depend on your card company’s requirements, which may include a minimum age requirement for the authorized user. Company credit cards typically allow more authorized users than major consumer credit cards.

The primary cardholder should check the fine print for their credit card or contact the issuer to determine the limit on authorized users.

Can An Authorized User Take Over A Credit Card?

Credit card issuers consider authorized users secondary or additional users. While they can access the account, they don’t have ownership rights.

However, authorized users do share some benefits primary cardholders enjoy. For instance, you can use the card online or in-store and take out cash advances. The list of what you can't do includes requesting credit limit increases, closing the account, changing the account's mailing address and adding more users.

To own your own credit card, you must apply for your own credit card. A secured card is a valuable alternative for anyone with a low or no credit score. Another alternative is to become a joint cardholder. You and the joint account holder would apply for the card together, and both of you would become a primary account holder. You’ll share access to the credit line and equal responsibility for the monthly bill payments.

How To Add An Authorized User To Your Credit Card

Adding an authorized user to a credit card is a fairly straightforward process. The following are the basic steps you’ll need to follow.

1.   Choose A Trustworthy Individual

Before adding an authorized user, make sure you can trust this person. Since they’ll have access to the account, you could be on the hook for purchases they make. That means if they’re to use your card, you want to make sure they’re responsible with their purchases and have a plan to pay you for what they charged.

It’s up to you who you want to add, but in most cases it’s fine to add your spouse, a trusted friend, and even family members you’re close with. No matter what, establish some clear boundaries and carefully consider any of their current or past financial behavior to determine whether it’s worth adding this person as an authorized user. Though there’s no legal age requirement, check with the credit card issuer to see what their policies may be.

2.   Login To Your Online Bank Account

In most cases, you can log in to your credit card account online and head to a dedicated section where you can update your information, including adding an authorized user. If that’s the case, follow the prompts on what you need to do. In some cases, you can send a secure message after logging in requesting that the credit card company add an authorized user.

There are also some credit card companies that allow you to add authorized users during the initial application process. You may also be able to call the credit card company to add an authorized user. In this case, have all the necessary information ready.

3.   Provide The Proper Information

You’ll need to provide the necessary information for your authorized user. Here’s what you’ll generally need to provide:

• Full legal name
• Address
• Date of birth
• Social Security number (not required by all issuers)
• S. citizenship status (not required by all issuers)
• Relationship to cardholder (not required by all issuers)

Some issuers may ask you to provide additional information, so check upfront to see what’s needed.

4.   Submit The Request

How you submit the requested information will depend on the credit card company’s website. In any case, follow the prompts or provide as much information as you can in a secured message to them after logging in to your account online. If you’re calling, follow the automated instructions to see which option is available for you to add an authorized user. If you want to set a spending limit for your authorized user, do that now.

Once the request has been submitted, the card issuer will verify the authorized user’s identity. If the request is approved, the new user will receive a new card in the mail. The authorized user will then need to activate the card once it’s received.

Consider The Pros And Cons Of Adding An Authorized User

Adding an authorized user to your credit card is not a decision to take lightly. Consider the benefits and drawbacks of this choice before making a decision either way.

Pros

• Helps build credit scores: An authorized user can build their credit history as long as on-time card payments are reported to the three major credit bureaus: Equifax^®, Experian™ and TransUnion^®. It may even accelerate how fast you can raise your credit score.
• Increases chances of earning credit card rewards: With more than one user making purchases on the same card account, you will likely earn more points and rewards.
• Share an account with family members: If you want to teach your child about credit, adding them as an authorized user can be a valuable learning experience that develops good credit habits.

Cons

• Possible credit damage: If your authorized user overspends or doesn’t reimburse you for their charges and you struggle to pay on time, it can hurt your credit and finances.
• Possible extra fee: Some credit card issuers charge a fee to add additional users.
• Ultimately responsible for payments: If the authorized user doesn’t pay their portion of the monthly bill, you’ll be on the hook for payment.

An Authorized User Isn’t A Joint Cardholder

For a joint credit card, both applicants apply for a card together, and both are considered primary cardholders. Each cardholder is equally responsible for footing the credit card bill. The credit card issuer will check the credit history of both applicants to help determine approval.

Because an authorized user doesn’t go through a credit check and isn’t considered a primary cardholder, they’re not legally responsible for card payments.

Authorized User Credit Card FAQs

Do you still have questions about authorized credit card users? Here are some answers to frequently asked questions on this topic.

Will removing myself as an authorized user hurt my credit?

That depends on a few factors. If your primary cardholder has a history of on-time payments, removing yourself as an authorized user will erase the positive influence of their credit history on your credit report. However, removing yourself if the primary cardholder has a history of late payments will wipe out their negative impact.

What can authorized users do on credit cards?

An authorized user can make purchases and direct payments to your credit account. They can’t ask for credit limit increases or make any major account decisions.

How long does it take to build credit being an authorized user?

The time it takes to build credit will depend on whether the authorized user has existing credit. On average, it takes about 6 months to build a credit history.

The Bottom Line: An Authorized User Can Help A Responsible Cardholder Build Credit

An authorized user is an additional user on a person’s credit card. This person, called the primary cardholder, is ultimately considered the owner of the account and is responsible for all payments. However, authorized users can use the credit card account much like the owner would.

If you’re someone who wants to be an authorized user, start by reaching out to someone you trust who you know is responsible with their credit. If you’re the primary cardholder and someone asks you to add their name on your card, think through the decision carefully. If anyone mismanages the account, both users are at risk.

No matter whether you’re the primary or authorized user, it’s important to understand how to manage your credit properly. That way, you’ll be able to benefit from a good credit score for years to come, such as accessing competitive interest rates and the best rewards credit cards.