I’m thinking of purchasing an authorized user account as part of my credit repair. What do you think?
If you are considering incorporating an authorized account into your credit repair program you should see if a family member is willing to be the donor rather than purchasing the account.
Don’t Purchase Accounts
In fact, buying an authorized user account may not improve your credit score at all. The most recent version of the FICO credit scoring software includes a block on purchased authorized user accounts. This does not mean that all authorized user accounts are ineffective for credit repair. Fair Isaac Corporation, in implementing the recent change, was very clear that legitimate authorized user accounts (i.e. those given by family members) will continue to give the full credit score benefit. But the software update effectively eliminates the benefit of purchasing these accounts.
The FICO Software Block
The exact method by which Fair Isaac has managed to make this update effective is not public knowledge, but it may be speculated that, with the help of participating credit card lenders, they are counting the number of authorized card members per account. This alone would curtail a significant amount of the abuse.
Build Your Own Credit Too
We have long endorsed the use of authorized user accounts as a part of a comprehensive credit repair strategy. But, it must be emphasized that these accounts are not a proxy for building new credit of your own, which is absolutely essential for long term credit repair success.
Use the Right Donor
If you decide to have a relative add you to one of their credit cards as an authorized user for credit repair purposes there are a couple of things that you need to be aware of. First of all the donors card must be in excellent standing, be at least two years old, and have a relatively low balance relative to the card limit. Secondly, keep in mind that once you are an authorized user your credit score will reflect anything that you donor does with the subject account. It would be very helpful for your donor to inform you if then plan any unusual use of the card.