In order to improve my scores I had my wife make me an AU on her AMEX card. She has $15k limit but $10k balance at the moment. Does this mean I'm going to see an extra $10k in debt on my next CR? How does this work exactly?
Yes the tradeline will show on your credit report with the credit limit, balance. Your score will be affected by it, but it depends how many open accounts you have compaired to the credit lines. Most ''experts'' say to have your balance at no more than 30%.
Actually, it depends upon how the second AmEx card is set up, if it is an "additional card" (with your name on the card, and a slightly different account number), then your credit report will only track your usage and utilization.
dont believe so An AU has 0% financial responsibility for that card. I think authorized users and coapplicants are being confused here. It does not make sense that a CRA would be reporting 10k of "debt" on your report when -you- owe nothing on that account. I could be wrong, but I do work for a credit card company. I work in the marketing (balance transfer/consolidation) department. Authorized users are simply additional card holders and don't even appear on the statements of the bill. Coapplicants are financially responsible for a card, however. It seems absurd to me someone else's debt can penalize your credit report, and I do not believe that is accurate. In college I had my parents as AUs on my C.C.s for maintenance purposes... and so do many. I highly doubt these TLs are penalizing those users. I will check this when I go into work tomorrow. "Actually, it depends upon how the second AmEx card is set up, if it is an "additional card" (with your name on the card, and a slightly different account number)" edited: at least under MBNA/BOA there's no such thing as an AU with a slightly different acct #. Or a coapplicant. All card numbers would be exactly the same. Maybe this varies between companies, however.
Piggyback on someone else's good credit The fastest way to establish a credit history can be to "borrow" another's record, either by being added to a credit card as an "authorized" or joint user or by getting someone to co-sign a loan for you. Having a co-signer can allow you to qualify for loans you might not otherwise get. The loan will show up on your credit report and, if you pay it off responsibly, will help boost your credit score. If you default, however, you won't be the only one who suffers. The co-signer has basically promised to make good on this account, so any delinquencies will show up on her credit report as well. Being added as an "authorized user" has its risks, for you as well as the person giving you access to the card. If your father makes you an authorized user of his credit card, for example, his history with that account can be imported to your credit bureau file, giving you an instant credit record. If he has handled the account well, that reflects well on you. But if he hasn't, his mistakes would also become yours. Any late payments or other problems could make it harder for you to get future credit than if you'd established your history without help. Even if you trust the person adding you to the card, you may not be able to piggyback on his or her credit. Some credit issuers won't report authorized users to the credit bureaus, particularly if the user is not married to the original card holder. If the point is to give you a credit history, the person who's adding you as an authorized user should call the issuer and ask how (or if) your status as a user will be reported. http://articles.moneycentral.msn.co...InYour20s/9waysToBuildAKillerCreditScore.aspx
