The primary difference between a joint credit card and an authorized user on a credit card is who is responsible for making payments on the account. With a joint credit card, both accountholders are equally on the hook for paying the bill, whereas an authorized user has no legal obligation to pay. There are other minor differences between the two that could affect which approach you decide to take, though.
Yes, for both cardholders (not all issuers report authorized users’ activity before age 18)
Currently, both joint cardholders and authorized users must be added to the primary cardholder’s account. Primary cardholders may also add more than one authorized user, depending on the issuer and the card. In addition, authorized users cannot make changes to the account, like increasing the credit limit or adding more authorized users, but joint credit card owners have equal access to all the account’s functions and features.
Yes, authorized users do build credit. You can actually build a good or excellent credit score just as an authorized user on a credit card. When you become an authorized user, the account is added to your credit report, which means on-time payments by the primary cardholder will help you build good credit history. But because authorized users are not responsible for paying the bills, credit scores don’t give authorized user accounts as much weight. So you won’t … read full answerbuild credit as fast as an authorized as you would with your own credit card account.
Still, the fact that most credit card companies don’t have a minimum age for authorized users, means becoming one is a great way to build credit before you can get your own account. But there are a few positives and negatives you should know about before becoming an authorized user.
Here’s how authorized users build credit:
A friend or family member adds you to their credit card account as an authorized user.
The credit card account gets added to your credit reports, just like if it were your own account.
The issuer gives updated account information to the credit bureaus on a monthly basis.
Your credit standing improves if the account owner has on-time payments, low credit utilization and other signs of financial responsibility.
Your credit gets hurt if the account holder behaves irresponsibly.
You can get an account with negative information removed from your report, since you aren’t responsible for making payments.
Authorized users do build credit, but that credit can be good or bad, depending on how the primary accountholder manages balances and bill payments. So you only want to become an authorized user on an account owned by someone responsible.
But in the event that an authorized user account does end up hurting your credit, you can dispute the account to get it removed from your credit report. That’s because any mistakes made won’t be your responsibility.
Finally, you’ll build credit faster if you also have your own credit card account that you use responsibly. You can get a starter credit card once you turn 18 years old, as long as you have enough money to pay the bills.
If you have bad credit and are worried you won’t get approved, try applying for a secured credit card. Secured cards require security deposits, but they have the highest approval odds of all credit cards and accept people with bad credit.
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