Credit Advice

If you are simply an authorized user of someone else's credit card, you will not receive anything positive or negative from their usage. It will not affect your score at all. That's why, I've personally learned, you must always be very careful of who you choose to have as an authorized user, since they risk nothing but can ruin YOUR credit.

My ex-husband had me as an authorized user on his credit cards. He lost his job and was unable to make the payments and now they all show up on my credit report. I've read different things saying that as an authorized user they would not figure into my credit rating, but I've also heard that if they are in collections, they would. I have no idea what is the right answer. Thank you for your response.

That's not true. As an authorized user, the available credit, amount owed, and debt to income all reflect on the user's credit report and score regardless of the account's standing.

There was a lot of drama a year or so ago when agencies were seeking to close a loophole created by people "buying" authorized user space on other people's accounts, but due to the large number of husbands and wives who share cards without ever considering the difference, bureaus reversed themselves and report accordingly.

Sorry I forgot to include the website with some excellent information on this:

http://www.bcsalliance.com/z_authorizedusers.html

Another good source:

http://www.mtgprofessor.com/A%20-%20Credit%20Issues/are_authorized_users_at_risk.htm

This states basically what I've said all along: creditors will try to make an authorized user liable and put it on your credit report, but the fact remains *100%* that an authorized user is NOT LEGALLY LIABLE FOR THE DEBT AND SHOULD NOT PAY IT.

 I just looked at my credit report and observed that my ex (girlfriend) has been late on her accounts.  Years ago, she put me down as an authorized user and now its showing on my credit report as a negative payment.  Are we sure this wont affect your score..even though it on my credit report?

Yes, they will remove the account and it will shorten your average credit history. The difference in your credit score is pretty minimal - I recently went from an average of 5 years (with a long of 15 years) to an average of 2 years, and it dropped my score by 4 points (I am around 700, building back from an '02 bankruptcy). If you have late payments (because of your ex-), this is a far more negative weight than the positive of reducing the length of credit history, not to mention it might get eventually removed anyway. Also, if the account is still open, don't even THINK about leaving the chance that you could get burned further. That would truly be asking for trouble. My sister managed to do this exact thing to me - to the tune of $8,000 (part of my bankruptcy!) - and that was my own family! Yikes! :) Good luck, Nathan

 While you are not responsible for a debt as an "authorized user", the credit reporting agencies like to include the account on your report so that a "debt buyer" can use it to collect from the authorized user (who may have a good credit score) when they can't collect from the actual account holder.  Keep in mind, the CRAs sell this information to debt buyers and they include information about who's more likely to pay the debt.  I have a lawsuit against Equifax for this very issue.  Experian and Transunion removed the account when I disputed it as "not mine".  Equifax refused to remove it.  The account belongs to my wife and it's now in collection.  I removed my name as an authorized user and Equifax still refused to remove the account.  I disputed it no less than 3 times.  Now that it's in dispute for one last time while the lawsuit is still pending, they have no choice but to remove the account or report the accurate status as in collections....and of course, if they report the current status as "in collections" to damage my credit score, they're asking for trouble since they already knew the account was not mine and I've never been a co-obligor on the account.  The CRAs know that consumers are ignorant to the law...so do the debt buyers.  I'd advise every consumer to get familiar with the provisions of the Fair Credit Reporting Act and file a lawsuit if the CRAs refuse to remove these accounts when disputed.  In most cases, you don't need a lawyer to do this and many lawyers won't take a case like that because of the small amounts involved for statutory violations ($100-$1000).  If they intentionally refuse to remove after a reinvestigation, the potential for punitive damages is triggered and there's no set limit as to the amount of punitive damages that can be awarded. By the away, before filing a lawsuit against Equifax, I began using screen capture software to capture proof when I submitted disputes to Equifax via their online dispute system.  Why?  They can and did change my disputes after they were submitted and in some cases the diputes fell into black holes and weren't responded to....also cases where they provided false dispute results without a corrected credit file forcing me to purchase new credit files only to realize what they said they deleted or corrected wasn't true. Also beware of the bogus fraud alert on your equifax credit file.  If you only see the words "Extended Fraud Alert" on your credit file with no statement and contact info, you are on their VIP (blacklist) and they will make everything a living nightmare for you anytime you file a dispute or attempt to get free credit files.  Also, they may tell you that you're required to pay for a security freeze when you're in a state that doesn't require a fee...this is done by intentionally prevented you from placing a freeze via the web site or the automated phone system.....the VIP status flag is used to block the services.  The ViP status flag will also block any attempts by you to get credit monitoring unless you purchase that service directly from Equifax (akin to Extortion...i.e. you can either pay us to monitor your files or we will block your attempts to monitor your equifax credit file.).  I know they do this because after they added the VIP flag to my file, I was unable to monitor the equifax credit file via IdentityGuard, Transunion or Bank of America PrivacySource.  I ended up paying for the monitoring and cancelling because Equifax refused to remove the VIP (blacklist) status block. Lastly, items on your credit file which you are only an authorized user do in fact affect your credit scores.  Some people use it to increase their scores, but they're scores will be affected negatively if (1) the credit limit is decreased and the highest balance is lower than the limit or (2) the account goes into collection after default.  Don't forget, the collection company can attempt to collect from you as an authorized user if they think you are not aware that by law, they can't collect....but they'll still damage your credit by verifying the account when you dispute it which will continue to lower your score until or unless you get the account removed.