So I was reading up on here and on a "ask/question" place on the credit bureau's site and it was talking about adding people as an AU on your cc to build their credit.
So I added my sons name to my Discover the other night. I read on here that people stated that they didn't understand why all they ask for is the persons name and most replies said that it's easy to match it up with the address.
Well here's my concern...my son has a different last name (from my previous husband), but he does live at this address and if they are looking at my credit report, it will also report that name on there as well. But, he has absolutely NO credit at all. So, how will they do this? Will it all of a sudden start his credit file (I'm hoping). I just feel really bad for him because he has been trying to start his credit and has applied at a few different department stores and they won't give him anything stating "no credit history on file." He's 18, graduated from High School this past year, has been at his job 2 years (in 2 months), he has always paid cash for everything and even bought both of his current cars (with one being an Audi) using cash. He saves quite well until he gets what he wants. Him and his girlfriend of a little over a year are planning on getting an apartment next year around March and having a good credit file would probably help.
Although I consider him very responsible, I do know the "rules" to adding an AU (YOU are responsible for the bill and they are not if not paid. I also know if I mess up, they can be removed from the account as an AU and have it removed from their credit). I will probably NOT give him the card when it comes (it said 7-10 days it should arrive) and just let him use it every once in awhile as he gives me the money to pay for what he's using it for.
Thoughts on how they match this up and create his credit file?
Im not sure since your last names differ if it start his credit history. Im sure other will chime in...as for what your son can perhaps do to start his history is by grabbing a few secured cards from any of the banks that will graduate his credit...ie bofa, wells, etc. or capone if no one else wants to opend a secured card for him. After even a year he might be able to get approved for unsecured cc. By then depending on how he has treated those secured cards they might also have unsecured by then as well. Hope this helps
Yea, I did mention the secured cards to him and he wasn't too thrilled about the idea. What I found weird was when he applied for these department store cc's (in person at the stores), they didn't ask him for his work history or if he had a bank account. He just gave them his name and ss#. Now it's been a LONG time since I was 18 and applying for my first cc, but back then they did take EVERYTHING in to consideration and a department store card was usually the first card you started out with (mine was Lazarus). It wasn't "that" hard to get one. (I know times have changed and it's harder to obtain credit, but geesh, they could at least start him out with a small limit).
My DH is on several of my cc's (including Discover) and our last names are different. The only cr that didn't pick up one of his cc's was TU.
Thanks for the info Lexie. I wonder why TU didn't pick it up. I think when I get these other 2 cards, I'll add him and the hubby to both of them too. Might as well help build everyone's (BTW, I'm hiding those cards when they come LOL).
ADD HIM TO AMEX AND CHASE! They will get him so much further... especially amex because of back dating later for his own amex card if he gets one down the road.
and amex will ask for his social, so it will for sure be added to his credit (still no credit pull)
In theory - if you're worried about him spending and not paying the bill, add him as an AU and not give him the card. Also, if he's good at saving money, he could try the Secured BOA route. I've heard Great stories that way.
If he's going to college, Discover IT Student Card is great, Discover was the first card to lend me Credit.
As your son does not have a credit file, it is highly unlikely that the credit bureau will pick up adding your son as AU and create a credit file for him. The reason is simple. SSN is used as identification and credit bureaus don't have his SSN tied to his name etc.
Assuming your signature is correct, I recommend the following process for him:
1) Add him to AMEX first. Amex AUs are different as they request SSN for AU's. They will report to credit bureaus and more importantly, create credit file for him. Make sure to create online ID for his new card on AMEX website as someone earlier pointed out, it will lock in his member date (btw, doesn't mean he needs to have access to card or id).
2) Check credit bureaus for next couple of months. Basically you are waiting to confirm that a credit file has been created for him.
3) Once his credit file is created, feel free to add him as AU to your best two cards (remember what it means to be a good card for AU. Ask if not sure). You can get him off the AMEX is not one of your best cards.
4) Wait till 2 cards report
5) Now he should app to two cards that will grow with him or he can keep. Tougher now. I would have recommended Cap One for Newcomers, but doesn't exist anymore. I forget who will take AU accounts into effect. Might want to try local CUs. Some others might want to suggest a couple of cards to try.