According to a 2018 study done by Credit Sesame, people who had a fair credit score saw their credit score improve nearly 11% just three months after becoming an authorized user on someone’s credit card.
An authorized user is an additional cardholder on someone else’s credit card account. You have a credit card in your name that is linked to the primary cardholder’s account.
Being an authorized user might not impact your credit at all. Credit scoring models only consider information that’s currently on your credit report—nothing more and nothing less. So, in order for a credit card to affect your scores, it must show up on your credit reports with Equifax, TransUnion and Experian.
Being an authorized user can affect your credit in both positive and negative ways—but it can also have no affect on your credit whatsoever. … Whether the lender reports authorized users to the credit bureaus. Whether both the credit account owner and the authorized user use their shared account responsibly.
You can make purchases and use the card as if it were your own, but you’re not the primary account holder. To make you an authorized user, the primary account holder simply adds your name to their credit card account, giving you authorization to use it.
Being added as an authorized user on another person’s card may help you establish a credit history or build your credit. Yet cardholders and authorized users’ on-time, late or missed payments will be added to both parties’ credit reports, so it’s important that cardholders and authorized users see eye to eye.
Does being added as an authorized cause a hard inquiry on your credit report? No, being added as an authorized user will not allow the lender to do a hard inquiry on your credit report. This is because the account holder is responsible for the debt that an authorized user generates.
Some credit card companies let you add an authorized user without providing that individual’s Social Security Number (SSN). You only need their name, birthday and address in some cases. But requirements vary by credit card company, and not all of them will allow you to add an authorized user with no SSN.
If you’re the primary account holder, removing an authorized user won’t affect your credit score. The account will continue to be reported on your credit report as normal.
Is Piggybacking credit illegal?
Credit card piggybacking is not illegal in the case of a legitimate authorized user relationship. But it could be considered bank fraud if used to deceive financial institutions and borrow money under false pretenses. … Bank fraud carries a penalty of up to $1 million in fines and 30 years in prison.