topic Re: JOINT vs. AUTHORIZED USER in Relationships and Money

JOINT vs. AUTHORIZED USER

Anonymous — Sun, 17 Apr 2011 03:14:22 GMT

Hi everyone.

Will someone please explain the difference between JOINT and AUTHORIZED USER?

Here is my understanding. Please advise if this is right or not:

JOINT - Both spouses are liable for the debt on the card, regardless of any divorce decree.

AUTHORIZED USER - The spouse who is an authorized user is NOT responsible for the debt and cannot be forced to pay. In fact, they can request to be removed as an authorized user if so desired.

Thanks!

Re: JOINT vs. AUTHORIZED USER

MarineVietVet — Sun, 17 Apr 2011 03:31:46 GMT

@Anonymous wrote:
Hi everyone.

Will someone please explain the difference between JOINT and AUTHORIZED USER?

Here is my understanding. Please advise if this is right or not:

JOINT - Both spouses are liable for the debt on the card, regardless of any divorce decree.

AUTHORIZED USER - The spouse who is an authorized user is NOT responsible for the debt and cannot be forced to pay. In fact, they can request to be removed as an authorized user if so desired.

Thanks!

I believe everything you wrote is correct AFAIK (As Far As I Know).

From a BK years ago to:
EX - 3/11 pulled by lender- 835, EQ - 2/11-816, TU - 2/11-782

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

Re: JOINT vs. AUTHORIZED USER

haulingthescoreup — Sun, 17 Apr 2011 05:03:53 GMT

joint = (co-)ownership

authorized user means simply that, authorized to use the CC

The only asterisk I would add is that authorized users on American Express are (potentially) responsible for the charges made via their AU cards, which have different numbers. If the cardholder defaults, AmEx will try to get partial payment from the AU.

Re: JOINT vs. AUTHORIZED USER

MarineVietVet — Sun, 17 Apr 2011 21:19:51 GMT

@haulingthescoreup wrote:
joint = (co-)ownership

authorized user means simply that, authorized to use the CC

The only asterisk I would add is that authorized users on American Express are (potentially) responsible for the charges made via their AU cards, which have different numbers. If the cardholder defaults, AmEx will try to get partial payment from the AU.

Thanks for adding that HTSU. I keep forgetting that little but very important caveat.

Re: JOINT vs. AUTHORIZED USER

Anonymous — Mon, 18 Apr 2011 03:46:05 GMT

Thanks to all.

Re: JOINT vs. AUTHORIZED USER

Anonymous — Mon, 18 Apr 2011 03:47:01 GMT

@haulingthescoreup wrote:
joint = (co-)ownership

authorized user means simply that, authorized to use the CC

The only asterisk I would add is that authorized users on American Express are (potentially) responsible for the charges made via their AU cards, which have different numbers. If the cardholder defaults, AmEx will try to get partial payment from the AU.

Not only American Express. USAA and a number of other major lenders have learned from AmEx.

Not only can they sue you over the debt, they can report the negative on your credit report.

Always read the contract.

Re: JOINT vs. AUTHORIZED USER

Anonymous — Mon, 18 Apr 2011 17:07:05 GMT

I'm an authorized user on one of my hubbies cc's. It's showing up on my credit report. No harm though, it's helping because of his good payment history. But I thought that only cards on which I might be a joint owner would show up on my report. Someone please advise. If I'm an AU on my husband's card, that will consistently show up on my report and affect my FICO score?

Re: JOINT vs. AUTHORIZED USER

MarineVietVet — Mon, 18 Apr 2011 19:26:43 GMT

@Anonymous wrote:
I'm an authorized user on one of my hubbies cc's. It's showing up on my credit report. No harm though, it's helping because of his good payment history. But I thought that only cards on which I might be a joint owner would show up on my report. Someone please advise. If I'm an AU on my husband's card, that will consistently show up on my report and affect my FICO score?

Yes and that can be a good thing for your credit as long as the account stays in good standing. You inherit the entire history of this account.

But if the account goes bad that also will reflect on your credit.

Re: JOINT vs. AUTHORIZED USER

haulingthescoreup — Mon, 18 Apr 2011 21:44:35 GMT

@MarineVietVet wrote:
@Anonymous wrote:
I'm an authorized user on one of my hubbies cc's. It's showing up on my credit report. No harm though, it's helping because of his good payment history. But I thought that only cards on which I might be a joint owner would show up on my report. Someone please advise. If I'm an AU on my husband's card, that will consistently show up on my report and affect my FICO score?
Yes and that can be a good thing for your credit as long as the account stays in good standing. You inherit the entire history of this account.

But if the account goes bad that also will reflect on your credit.

But the advantage to being an AU is that if you do want the card to stop showing on your reports, you can take yourself off of it. The next time the card updates, the AU account should disappear. Sometimes they still keep updating, and then you would dispute as "not mine", and it should be removed.

Re: JOINT vs. AUTHORIZED USER

Anonymous — Tue, 19 Apr 2011 16:36:37 GMT

Good to know. Thanks to all.

Re: JOINT vs. AUTHORIZED USER

Noctilum — Sat, 30 Apr 2011 13:30:42 GMT

Just letting you know, an authorized user can still be held responsible for the debt if it is court ordered.

Re: JOINT vs. AUTHORIZED USER

Anonymous — Fri, 06 May 2011 13:07:52 GMT

I work in credit cards for a popular military bank and if I have learned anything it is to NOT add anyone as a joint user. What gets me is that when the divorced couple calls complaining that they are joints on ex's cc they blame US for it.

"I certainly didn't approve to be added on my ex's cc that he has defaulted on! I didn't give ANYONE permission!" Uuuuhhh, yeah you did. At my bank we can't add secondary users during the initial credit application. We have to speak with both parties because of the permanent nature of it after they receive the card.

I would also hesitate on the auth users part. I spoke with a man who had just recently found out his wife was filing for divorce and put her attorney fees on his credit card that she was authorized to use (to the tune of $3000). When I went to bat for the customer and spoke with a senior she basically told me that it sounds like a domestic issue, and as far as we (the bank) our concerned he authorized her to use the card so he is responsible for the debt. Period.

Re: JOINT vs. AUTHORIZED USER

Anonymous — Fri, 06 May 2011 13:12:28 GMT

@Anonymous wrote:
I work in credit cards for a popular military bank and if I have learned anything it is to NOT add anyone as a joint user. What gets me is that when the divorced couple calls complaining that they are joints on ex's cc they blame US for it.

"I certainly didn't approve to be added on my ex's cc that he has defaulted on! I didn't give ANYONE permission!" Uuuuhhh, yeah you did. At my bank we can't add secondary users during the initial credit application. We have to speak with both parties because of the permanent nature of it after they receive the card.

I would also hesitate on the auth users part. I spoke with a man who had just recently found out his wife was filing for divorce and put her attorney fees on his credit card that she was authorized to use (to the tune of $3000). When I went to bat for the customer and spoke with a senior she basically told me that it sounds like a domestic issue, and as far as we (the bank) our concerned he authorized her to use the card so he is responsible for the debt. Period.

Very, very wise advice!

Re: JOINT vs. AUTHORIZED USER

Anonymous — Fri, 06 May 2011 13:13:10 GMT

@Corvidae wrote:
Just letting you know, an authorized user can still be held responsible for the debt if it is court ordered.

What do you mean? In what way? Can you please elaborate a little bit more on that, please?

Re: JOINT vs. AUTHORIZED USER

Anonymous — Fri, 06 May 2011 18:18:00 GMT

You may be responsible for your spouse's credit card debt as an authorized user if you live in a community property state. The laws varies with each community property state (Alaska, Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin) so if you are a resident of one of these states, you have research your state's laws regarding community property.

Re: JOINT vs. AUTHORIZED USER

DustyStash — Fri, 06 May 2011 22:28:50 GMT

Boy what a way to go ! Not only is it not enough to divorce the guy, but then you run up attorney fees and stick him with the bill ! ha !! There's a case of screwdom if I've ever seen one. Gotta watch these women ;oP

Re: JOINT vs. AUTHORIZED USER

Anonymous — Sat, 07 May 2011 10:17:21 GMT

This is very interesting to me because I too was under the impression that if my husband's credit card accounts to which I am an AU for shows up on my credit reports, that should be affecting my credit score.

However, I had a curious conversation with a banker from Chase the other day (at a local branch). He was encouraging me to open a new Chase credit card account. I told him, no thanks, my husband and I already have a credit card with you guys, and besides, I want to keep my revolving credit cards to less than 3. He then looks at my account and points out that the credit card that I am speaking of is under my husband's name and I am just an authorized user, therefore it does not count as one of my accounts that affect my score.

Puzzled, I asked again, really? But it shows up on my credit reports? And he said, just because it shows up on my credit reports doesn't mean they are factored in when FICO computes your score. He then called up his bank's Credit card office in front of me and asked the guy on the phone "hey so I just wanted to make sure of this, I have a client in front of me that's an authorized user on her husband's credit card with Chase. Does this account affect her credit score?" The answer that was given was, again, a "no". He further asked the guy on the phone "Even if that account shows up on her credit report?" and again, the answer turned out to be a "no".

I really don't know what to make of this... I suppose what I heard from the banker and indirectly from their credit card division is correct, however, just because I do see those AU accounts on my reports, it does make me skeptical.

Has anyone here heard of such a thing???

Re: JOINT vs. AUTHORIZED USER

haulingthescoreup — Sat, 07 May 2011 21:45:14 GMT

@Anonymous wrote:
This is very interesting to me because I too was under the impression that if my husband's credit card accounts to which I am an AU for shows up on my credit reports, that should be affecting my credit score.

However, I had a curious conversation with a banker from Chase the other day (at a local branch). He was encouraging me to open a new Chase credit card account. I told him, no thanks, my husband and I already have a credit card with you guys, and besides, I want to keep my revolving credit cards to less than 3. He then looks at my account and points out that the credit card that I am speaking of is under my husband's name and I am just an authorized user, therefore it does not count as one of my accounts that affect my score.

Puzzled, I asked again, really? But it shows up on my credit reports? And he said, just because it shows up on my credit reports doesn't mean they are factored in when FICO computes your score. He then called up his bank's Credit card office in front of me and asked the guy on the phone "hey so I just wanted to make sure of this, I have a client in front of me that's an authorized user on her husband's credit card with Chase. Does this account affect her credit score?" The answer that was given was, again, a "no". He further asked the guy on the phone "Even if that account shows up on her credit report?" and again, the answer turned out to be a "no".

I really don't know what to make of this... I suppose what I heard from the banker and indirectly from their credit card division is correct, however, just because I do see those AU accounts on my reports, it does make me skeptical.

Has anyone here heard of such a thing???

They're wrong. (Not unusual; lots of people in the lending industry seem to believe their internal urban legends, such as hard inqs don't affect scores and so forth.)

FICO 08 was going to start ignoring AU accounts for scoring, but they backed down. Few lenders are using it anyway. Most who pull FICO's still use the so-called "classic" FICO's.

What they are trying to do is determine whether there is some sort of legit relationship between the AU and cardholder, in an effort to weed out "piggybackers" (those who buy the credit histories of strangers.)

All three of my FICO scores most definitely changed when I became an AU on my then-husband's Discover card. This was back when we could pull all three.

I have read speculation that maybe only one or two AU cards would be factored in, but even that would mean that someone has changed the formulas, and I don't think that that has happened. Anything's possible, though.

I suppose Experian might be the wild card in this, because once they stopped letting us buy own EX FICO scores, we lost the ability to see what happened to scores when we made a change. Maybe they've started excluding AU accounts, although I don't know if they're able to do this without FICO's participation. (Scores are joint products between each bureau and FICO.)

Another thing that happens is when a lender uses an internal score system, as does AmEx. They can do anything they like with their formulas.

But otherwise, with the possible exception that Experian is up to something with its FICO's, and this would only affect you if Chase pulled your Experian FICO, your AU account is still factored into FICO scoring.

Re: JOINT vs. AUTHORIZED USER

Anonymous — Sat, 07 May 2011 22:35:50 GMT

VERY good to know : ) Thanks so much for the clarification!!

Then, as far as the general "no more than 3 credit cards" rule... would that include the cards that I am an AU for? or was Chase correct in that part that that technically doesn't count??

Re: JOINT vs. AUTHORIZED USER

haulingthescoreup — Sun, 08 May 2011 01:24:52 GMT

@Anonymous wrote:
VERY good to know : ) Thanks so much for the clarification!!

Then, as far as the general "no more than 3 credit cards" rule... would that include the cards that I am an AU for? or was Chase correct in that part that that technically doesn't count??

Which rule is that? If we all followed that, we probably wouldn't have a CC board, lol.

I have *pauses to count* 8 bank/ CU cards and 3 store cards. No, make that 9 bank/ CU cards and 3 store cards. That's about 3-4 more than I'd like to have, but I can't figure out which ones to get rid of.

Other than a new fee card that's worth the fee for me, they're free. I don't carry balances, so I don't pay interest. They all have rewards of one sort or another. And they certainly don't seem to hurt me when it comes to new approvals. Not bragging; it's just that credit seems to beget credit.