Credit Cards and Authorized Users Good or Bad?
Build effective powerful positive lines of credit
Removing as many erroneous, unverifiable, obsolete and misleading accounts from your credit report is very important to improving your credit but its not enough.
As I mentioned earlier 30% of your score is revolving debt ratio and 10% is mix of credit, that’s 40% that has nothing to do with bad history. It is crucial that you establish powerful credit lines.
Please be very careful when establishing credit, there are many companies on the internet that advertise that they can report credit lines to your credit report that belong to someone else and that these credit lines will give your 100 to 200 points, Don’t do it, I have not found one company that I would ever recommend to do this and have heard and read many a horror story about paying big money for a rented credit line and it never posts. Even if it did post chances are it will post that you are an authorized user on the account and will do little if anything to improve your credit score. I have personally tested the authorized user method and saw no improvement of my score.
I do recommend a very few select retailers that will extend real usable large revolving credit lines, that do help improve you credit profile and score and I have personally use them and still do. And on average gives 20 to 30 plus point boost and reports within 30 days to all three bureaus. If interested in these please reach out to me and I will be happy to send you the information or you can go to www.creditrestorationoftexas.com.
Building Credit: FICO gives big points for the following type of credit
- Revolving credit account: Adds points instantly, unlike installment loans
- Larger limits on cards: $2,500 and above means more points
- Unsecured cards: FICO gives very little points for secured cards
- Primary User: FICO gives little or no points for authorized user accounts
- Reports to all 3 bureaus: Fico can’t give points where it doesn’t report
Most consumers in an effort to build credit start applying everywhere they can and generally end up with a high risk, high fee, high interest credit card with a very small $300 limit, not to mention all the inquires. These cards may help a tiny bit but are not worth it for the fees, interest or results.
What about secured cards? Secured cards can be helpful but will have little effect on the score, because they are secured and FICO gives less points for secured credit cards.
Have yourself added to a friend or family members credit card. This can be very powerful and add points very quickly to your score. If you have a close friend or family member that has really good credit, a credit card that has a high limit ($1,000 or more), and carries a very low balance ($190 or less), ask them to add you to their card as an authorized user.
They simply call the creditor and request that you be added as an authorized user and give them your personal information and that’s it.
Your friend or family member has the additional card mailed to their address and they keep the card, you will have no access to it, but you get the benefit of their great credit history. One card reporting is good but three is better.