One of the fastest ways to boost your credit score is to be added as an authorized user by someone with excellent credit. When you are added as an authorized user to an account, you will inherit the credit history of that account (good or bad). If you have limited or no credit history, your credit score could quickly and dramatically improve with this method.
In other words, once you are added as an authorized user to an account (and it doesn’t matter whose account), the history of that account appears on your credit report – and it will be treated as if it was your credit history.
This can be a good thing if you are added to an account with an excellent history. for example, if a mother adds her daughter to a credit card that has been open and in good standing for 20 years, the daughter will receive the benefit of those 20 years of credit history.
There are just a few things to remember:
Not all credit card companies report authorized users to the credit bureau. The major credit card issuers (American Express, Bank of America, Chase, Citibank, Capital One and Discover) do report. However, many smaller banks and credit unions do not. Make sure you check with your bank or credit union to see if they report to the bureau.
The Risks of Being an Authorized User
There are a number of risks that both the account holder and the authorized user should consider.
For the account owner, the biggest risk is that the authorized user can start spending on the credit card – and the account owner is liable for the debt. If you make a son, daughter or friend an authorized user and receive a bill for a big weekend in Vegas, you will be responsible for paying the debt, not the authorized user. Be careful before you hand plastic to someone else.
IF YOU BECOMING A AUTHORIZED USER WON’T WORK FOR YOU
There are other ways to build your credit fast depending on what the cause of your poor score is … for example if you are carrying high balances on your credit cards that can have a strong impact on your credit score …. the good news is that if you pay up your credit cards and carry a low balance under 10% you can have your score shoot up by 150 points in 3 months! !!