The authorized user card is going to help you build your credit the best, now in this post we're not talking about which authorized user card is going to give you the best benefits like airport lounge access, and all that would be nicer, but we're talking about building credit here which authorized user card is going to help you build your credit the best.
The authorized user card
First of all, if you don't know what an authorized user card is, it's basically if you have a credit card it's the accounts in your name, and you ask for an additional card that has someone else's name on it, but it's still linked to your account. You give that card to that person may be a family member or whatever, and basically, they spend money on your account, so they're spending your money.
They're not legally obliged to pay it back, it's your responsibility to pay it back, but basically they benefit from it because that account shows up on their credit score, and as long as the accounts in good standing with on-time payments, and everything all that history will show up on their credit score too, so it can help them build their credit, this would be useful for well.
Parents can do it for their kids growing it., by the time they are 18 they already have a bit of credit history and going to help them in applying for credit cards and stuff like that. If you're a new immigrant to the country may be a colleague or a friend would be willing to do that for you. If you feel it's a bit awkward asking someone here could ever be an authorized user on your account, I mean like spend money on your account, you can say to them, they don't actually have to give you the card.
That's also another thing about it, they can chop it up or they can put in and draw a home, you do not have to spend on that card, but the on-time payments and the credit history will still show up on your credit report. So don't feel awkward about it, if you're just asking a friend you can reassure them by saying I'm not going to actually have the card, you can keep it.
what criteria this account needs to fulfill is
Let's now look at what criteria this account needs to fulfill, and there's kind of two sections, there's the behavior of the cardholder. The primary cardholder, and then there's also the attributes of the actual card itself.
First, we'll look at the situation where the status of the account of the primary cardholder, the account should have been opened for at least two years because you want a longer credit history. Obviously, if you are very new to credit you haven't even got a credit card of yourself, the only way is that you do want to make sure that the account has the credit history to get the maximum benefit out of it.
In addition to that, the person should have on-time payments, they shouldn't have missed payments in the last two years or even a longer period of time. If it's been open longer, the account should basically be in good standing like that with on-time payments, no miss payments, and their credit utilization shouldn't be too high. We always recommend credit utilization ideally shouldn't go over 30%, if they can be under 10% it's even better. That's going to have the best effect on your credit score. Those are factors two. Just ask the person if you're becoming an authorized user of their account, you can say them have you missed payments on your credit card account that you're adding me to? Maybe I don't want to be an authorized user, or if it's your colleague just ask them a few polite questions about it, just make sure that they have on-time payments and all that stuff.
We'll now look at the attributes of the cards themselves, and there are two things to consider. The first thing is to make sure that this card is going to report the full credit history on that card to the credit unions on your credit report, the authorized user's credit report now notably. American Express does not report the full history, it just reports from the time that you became an authorized user on your credit reports, so this might not matter to you so much if you're brand-new.
But I read a story on a my FICO forum this morning of a guy who he had been doing credit repair rebuilding his credit, he already had a couple of basic credit builder credit cards, and his wife put him as an authorized user on an American Express card thinking that it would help build his credit faster. Actually because Amex doesn't report the full credit history it looked like a brand new account had been opened, and it shortened the average age of accounts on his credit score, and it decreased his credit score by 20 points, and this guy was complaining that he could no longer get the best rates on the mortgage he was applying for, because he had this taken this 20 point hit and he is going to cost him an extra $2,500 a year on his mortgage.
He really learned the hard way on that poor guy, but anyway, so that's just something to watch out for notably. Amex doesn't report the full credit history, most other major card issuers do, you might want to look on some online forums like my FICO, just to get the most up-to-date information on that.
Secondly, for the maximum impact on your credit score, you also want to make sure that this authorized user card is going to report to all three of the credit bureaus. Now primary cards of pretty much all major banks in the US will report to all three, maybe there's a few that don't, but the major banks should report to all three like the chase, Americans, versus Sarah. But for authorized user cards, it is not always the case, and I can just demonstrate this on my credit report.
I believe there are three chase cards listed
If we open up Credit Karma, here you can see on this one TransUnion I believe there are three chase cards listed, now one of those cards Ayman is an authorized user' card on my wife's account, if we go over to Equifax you can see there are only two chase card listed under this, and that's because the authorized user' card must not have been reported. Chase is reporting this authorized user' card to only two or perhaps even one of the credit bureaus now, stuff like this changes all the time.
To get the most up-to-date information you may have to go online, luckily there is an easy resource, the author of this book Your Score Antony Davenport and this is a great book, he is a credit insider, he used to be a mortgage originator and now he runs a credit repair business on his website. He has a little resource that has some information that he updates. If there are any changes in the industry and he tells you which cards report to all three bureaus, at the moment those cards are Capital One, Discover, Bank of America, and Wells Fargo, and he does update this if there are any changes in the industry.
This might be a useful thing, just to look at if you're thinking of getting an or raises a card, and obviously if the one that you're thinking of getting or thinking of giving to someone is not on there, you may want to just phone up the card issuer, and you can ask those two questions. Does it report the full credit history on the authorized user's credit report and does it report to all three bureaus for the authorized user as well?
Those two questions are most important, so that is how to pick a good authorized user card, those four we just looked at are currently ones that Mr. Davenport, the author of this book recommends.
Other things you need to know
Lastly, I'd like to talk to you about a few things. First of all, we have credit sure food wallets, and the new RFID blocking cases coming this evening, so they probably will go on sale tonight. These are the small minimalist wallets, I, unfortunately, don't have the traveler wallets yet, they're coming in about two weeks, we've got several hundred of them on order. Because we just had such a backlog, and so many people have been sending me questions like when in a while it's coming in the walls some people it's like they've given up, they just send me one word wallets question mark, I'm frustrated too, I know you want to get them.
One guy even said that he's got one for Christmas and he really liked it, and he'd lost it and he wants to buy another one, like a sorry man, they're coming soon, but anyway, they should be going on sale tonight. If not tonight it'll be tomorrow, but hopefully tonight, and I will put a post online when they do, you can also join our Facebook page facebook.com/, and we'll definitely be posting on there when they go and sale.
Secondly, I also want to ask you about some future products, because we've been selling wallets, I've also kind of kicked around the idea of doing a paid credit building course, credit building, and credit repair course. This is what I'm talking about because this post was originally kind of knowledge that I had sort of prepared for that course, and I've been doing a lot of research, I've read loads and loads of books like that, this is one of the ones.
Hope this can help you.
Other webpage resource
Access cash from the equity: https://www.chase.com/personal/home-equity