Authorized User CLI question

[bkw]

Hi everyone. My fiance has added me to his oldest credit card as an AA . The credit limit is 7000, and this will be the highest limit I have ever had. He did tell me that it has been almost a year since he asked for a cli. He also told me it cost a hp to request increase. Will this ding my credit score as well? Thank you for any answers, I am trying very hard to rebuild credit after an extended illness.

[bkw]

by AA I meant AU. Sorry

[BrutalBodyShots]

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@bkw wrote:

I am trying very hard to rebuild credit after an extended illness.

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Unfortunately, it's a huge misconception that AU accounts "build credit" because they actually don't. It's not your credit history. All you are doing is "borrowing" credit history from someone else. Lenders know this and typically discount AU accounts for this reason. The only way to truly build credit is to maintain your own credit accounts "paid as agreed" over time.

When you say "rebuild" I'm guessing you have a dirty credit file (negative information present). Is that the case? If so, the best way to rebuild isn't to open or add new accounts at all. The best approach is to target the removal of any/all negative information. Adding new accounts can't dilute the impact of whatever negative information is present. I liken it to someone putting a new set of tires on a car that has no transmission and can't drive. Yeah, maybe it looks a little better, but it's still a vehicle that can't go anywhere.

As for the hard inquiry question, the answer is that it can only impact the credit file of the person applying for [additional] credit. The HP in this case would not impact your credit profile/scores.

[bkw]

Thanks for the reply. I should have been more clear as to why I am rebuilding. My last negative fell off 5 months ago, but in those 7 years I had racked up more cc debt so my util. was 85-97 % for nearly 3 years. Thanks to selling some assets, I have util down to 46% and my Eq Fico is 719. I was at 812 before the big flop, and really hope to get back there soon.

[BrutalBodyShots]

Understood. As you've correctly identified then, the solution is to pay down/off your carried debt. That's all there is to it. AU accounts are not something that will help with that of course, so they aren't aiding your process.

[bkw]

I can honestly say that when added me to Cap One with a decent limit and open 4 years, my score jumped 14 points. That could have been the only possible reason for that big of a jump. So I will have to agree to disagree (respectfully) with you on this.

[bkw]

And again, paying off the debt is the only real option, but getting scores up fast helps me with options such as low interest loan to help pay things completely off.

[BrutalBodyShots]

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@bkw wrote:

I can honestly say that when added me to Cap One with a decent limit and open 4 years, my score jumped 14 points. That could have been the only possible reason for that big of a jump. So I will have to agree to disagree (respectfully) with you on this.

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You aren't disagreeing with me. You just aren't understanding what I said. I didn't say that a credit score can't be impacted favorably by an AU account. What I'm saying is that your credit profile isn't, and it's your profile that matters. The score change doesn't matter. No lender is going to consider a score bump from borrowed credit history that isn't your own. That's why I said AU accounts are often discounted.

You aren't going to get a better interest rate on a loan due to a slightly higher score because of an AU account. 

[dfwxjer]

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@BrutalBodyShots wrote:

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@bkw wrote:

I can honestly say that when added me to Cap One with a decent limit and open 4 years, my score jumped 14 points. That could have been the only possible reason for that big of a jump. So I will have to agree to disagree (respectfully) with you on this.

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You aren't disagreeing with me. You just aren't understanding what I said. I didn't say that a credit score can't be impacted favorably by an AU account. What I'm saying is that your credit profile isn't, and it's your profile that matters. The score change doesn't matter. No lender is going to consider a score bump from borrowed credit history that isn't your own. That's why I said AU accounts are often discounted.

You aren't going to get a better interest rate on a loan due to a slightly higher score because of an AU account. 

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I believe the score bump can help with automated underwriting, but do agree that if the loan goes for any form of manual review that the AU account will be disregarded.