Improving Your Credit Score Using “Authorized User” Accounts

April 15, 2016 - 4 min read

Improve Your Credit Score Using “Authorized” Accounts

There are dozens of mortgage loans available to today’s home buyer — many of which allow for .

However, your ability to get approved for such loans will depend on the strength of your credit score.

In the world of mortgage, credit scores are numerical rankings which tell a lender whether you’re likely to pay them back.

Higher scores beat lower scores.

Lower scores are likely to default. Higher scores get access to a wide range of mortgage programs such as the which allows for a 3% downpayment; and piggyback loans, which can help a homeowner .

Higher scores also correlate with the best of , which means that having a high credit score can also lower the long-term cost of owning a home.

So, if your credit score today is lower than you’d hope, how do you improve it quickly?

Well, there are lots of documented , but most of those changes take time to go into effect. Luckily, there’s an over-looked tip which can give an unexpected boost to your credit score today.

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Your Credit Score Is Different Every Day

Your credit score is a numerical ranking and it’s in constant flux. As you pay down auto and student loans, run up credit cards and charge card, and just go about your life, your credit score reacts.

As a consumer, it helps to know your credit score and, lately, the cost of getting access to your credit report has dropped to zero.

By law, U.S. consumers are now entitled to a free copy of their credit report once annually. To get yours, visit a site such as and follow the on-screen instructions to produce what’s called a “tri-merge” — a composite report culled from the three major credit bureaus.

The three major bureaus are TransUnion, Equifax, and Experian.

On your free credit report, you will see all of the active and recently closed credit accounts in your name along with the payment history of each. The report will also show any judgments, tax liens, or bankruptcies linked to your name and social security number.

The report will use abbreviations and notations which may be unfamiliar to you at first, but you’ll quickly come to understand the report’s meaning.

Alternatively, if you’re in the process of applying for a mortgage, your mortgage lender can share your credit report upon request as a complimentary service. You may find this simpler than using the “free report” outfits.

When you get your report, there is one notation to which you should pay special attention, specifically, because it may be harming your credit score. It’s the “Authorized User” notation.

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What Is An “Authorized User”?

When you’re an “Authorized User” on a credit account, it means that you have access to the account but that your credit was not considered in the account’s initial approval.

For example, you may be an authorized user of a credit card originally issued in your parents’ name, which was given to you for “emergencies only”.

Or, you may be an authorized user on a department store charge card originally opened by a spouse. There are many real-world examples from which to choose.

To see if you’re an Authorized User on an account, look for the notation of each account on your credit report under the heading ECOA (Equal Credit Opportunity Act).

If you see the letter “A”, this means that you are an Authorized User of the account. Being an authorized user, in some cases, could be harming your credit score and you may not have known it was happening.

This is because, as an Authorized User, the credit bureaus assign to you the payment history and debt patterns of the “main” account holder.

In other words, if you’re with an ex-business partner and that ex-partner stops paying the bills, your credit score is affected, too.

Therefore, when you find Authorized User accounts on your credit report, put some thought into what’s best to do with them.

You should ask to be removed from cards which may be harming your overall credit score (e.g.; maxed-out accounts, accounts with a history of late payment); call it “guilt by association”.

On other cards, though — those which are helping you (e.g.; accounts with “age” of 10 years or more; cards with low debt utilization and good payment history) — you should try to stay “authorized”. These cards may be helping your score.

This strategy can also help you if you’re new to managing credit and without many “tradelines”.

Tradelines are credit-lingo for “accounts with creditors”. When you’re short on tradelines, it can be hard for the credit bureaus to assign to you a credit score; and hard for lenders to know whether you’re a “good borrower”.

By joining an existing tradeline account as an Authorized User, you can piggyback on a relative’s or spouse’s good credit standing until you’ve had time to build a credit profile of your own.

Getting yourself “authorized” to use a family member’s credit card can be a terrific way to boost your own credit rating.

What Are Today’s Mortgage Rates?

Once per year, you can get your non-score credit report from or, as part of the mortgage application process, many lenders will share your score and report with you for free.

Get today’s live mortgage rates now. Your social security number is not required to get started, and all quotes come with access to your live mortgage credit scores.

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Mark Greene
Authored By: Mark Greene
The Mortgage Reports contributor
Mark is a 25-year veteran of the mortgage origination industry and now writes about the inner workings of the industry for Forbes.