Which Credit Cards Are Best for Authorized Users Looking to Build Credit?

If you make your payments on time and don't use up too much of your available credit, adding someone to your credit card as an authorized user is a straightforward way to boost their credit scores. This is predicated on the assumption that you have used up only a little of your available credit. However, for this tactic to be successful, you will need to ensure that the relevant information on that account is included on both of their credit reports. If this is not the case, adding a family member to your card — a kid, a spouse, or a parent — will not affect their scores. If you want the identical account to show up as a "tradeline" on the credit reports of your authorized users, there are two primary elements that will determine this:

Issuer's Policy

According to the poll, all of the main issuers reported approved user activity to one or more of the three major credit agencies (Equifax, Experian, and TransUnion) in some way. However, some of those polled said they only submit information if the main account has good material or if the authorized user is younger than a specific age.

Credit Bureau's Policy

Credit bureaus are not required to include an authorized user's account in the authorized user's credit report, and some of them may opt not to if the account has negative information if the authorized user is under a certain age threshold.

If you wish to help someone build credit by adding them to your account, it might save you time and energy to be familiar with the practices of credit issuers and credit agencies. After all, you would want to avoid adding someone to an account, thinking it will help their rankings, only to find out a few months later that it didn't.

Issuer Policies on Authorized Users

All of the main issuers polled below said that they reported approved user activity to all major credit agencies. This statement indicates that the relevant information is typically included in authorized users' credit reports. On the other hand, their rules about reporting differ.

What May Be Causing The Account To Be Missing From The Authorized User's Credit Report?

You may get a solid basic idea of why a tradeline may or may not be shown on your authorized user's credit reports by looking at the rules of the issuer and the credit bureaus. However, in addition to the exclusions that are outlined in these standards, the following are some other reasons why an account can be missing:

Your issuer did not report any activity about authorized users. It is optional for issuers to disclose approved user accounts, even though this practice is rather prevalent. According to Rod Griffin, the director of consumer education and awareness at Experian, "in certain situations, albeit unusual, lenders may opt not to report approved user accounts." This was stated in an email by Mr. Griffin.

When creating the account, you still need to provide some information. Lenders who report to credit bureaus are required to provide certain information on authorized users, including the authorized user's date of birth, by the National Consumer Assistance Plan, an effort that the three main credit agencies initiated. Even while you may be able to add someone to your account without first supplying this information, the fact that you did so will be recorded to credit bureaus once you provide it. For example, AmEx states that you may add an extra cardholder to your account without giving their date of birth or Social Security number, but the new card will be canceled unless this information is provided within sixty days of the first request to add the cardholder.

The issuer ended the relationship with the authorized user account. If an issuer discovers that any information provided by an authorized user is fake or if the authorized user did not grant their approval to be added to the account, the issuer typically has the right to terminate the user's account. It's possible that a mistake caused the account to be closed, but it wasn't very likely. Call the customer care number for your card issuer and inquire about the absence of the account from the credit reports of your authorized users if you are unsure why this is the case.

Do Authorized Users Of American Express Get Reported To Credit Bureaus?

American Express will submit authorized user information to credit bureaus if any of the following conditions are met:

• At least 18 years of age is required of the authorized user. (American Express authorizes users, whom the company refers to as "extra card members," starting at 13.)
• The card account has yet to reach the overdue status. According to AmEx, "we shall suspend reporting on the Additional Card Member's Card to keep good history on the Additional Card Member" if the principal account gets past due on its payments.