Co-Signing and Usage

[gambleforlove04]

So back when my credit was in the good I cosigned credit card for my younger brother.  The CL is only $300.  My credit is not so good now, I am in the mid/low 500s and have one credit card with a $250 CL and since I have found this forum last week I have been working hard writing letters and getting things cleared up. The problem is my brother is always at the max on his credit card so this is messing with my utilization %.  He pays it on time most of the time and has been 30 days late twice April 2011 and Jan 2011. The accound was opened in 2007.  What should I do?  Should we pay it off and close it and have him open his own?  This would mess with his credit too since it is his first credit card ever. Should we pay it down and I hope that he keeps his utilization down?  Should I have him make me an authorized user? If you need any more info let me know.  Thanks for your help. 

[rckstrscott]

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@gambleforlove04 wrote:

So back when my credit was in the good I cosigned credit card for my younger brother.  The CL is only $300.  My credit is not so good now, I am in the mid/low 500s and have one credit card with a $250 CL and since I have found this forum last week I have been working hard writing letters and getting things cleared up. The problem is my brother is always at the max on his credit card so this is messing with my utilization %.  He pays it on time most of the time and has been 30 days late twice April 2011 and Jan 2011. The accound was opened in 2007.  What should I do?  Should we pay it off and close it and have him open his own?  This would mess with his credit too since it is his first credit card ever. Should we pay it down and I hope that he keeps his utilization down?  Should I have him make me an authorized user? If you need any more info let me know.  Thanks for your help. 

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Well, it depends on how you applied

There is no such thing as a cosigned credit card. You are either an account holder, a joint account holder, or an authorized user.

Since you applied together, you are likely a joint account holder, or its YOUR card and he is the authorized user.

With these likely scenerios, there is no real way to make YOU an authorized user.

If I were you,  I would pay the card to 0. You can take the card from him, or cut it, but you don't have to close the account, just don't use it. Then; I would send GW letter and hope to get those lates removed, although you should be aware that the damage of 30 day late payments will fade after 2 years.

What is the balance on this card? With this card being older (2007), it will keep you AAoA better and if you have a 0 balance on it, it will help you util and your scores should increase quite a bit.

-scott

[gambleforlove04]

Scott,

Thank you for responding to my problem.  I was working as a teller at the credit union at the time so the application was in his name and I cosigned for him to get it since if you worked at the credit union you were guarenteed a credit card so I cosigned for him to guarentee that he wouldn't get declined.  All of my CRs show me as a co-signer or co-maker. 

The balance on the card is at thelimit.  The other problem is that this is they only credit card he has.  I don't want to take it from him because he has been fairly responsible on it besides his two late payments and keeping it at the max. Should I suggest that he opens a card by himself so I can clean this one up?  I agree that closing it is a bad idea.

[rckstrscott]

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@gambleforlove04 wrote:

Scott,

Thank you for responding to my problem.  I was working as a teller at the credit union at the time so the application was in his name and I cosigned for him to get it since if you worked at the credit union you were guarenteed a credit card so I cosigned for him to guarentee that he wouldn't get declined.  All of my CRs show me as a co-signer or co-maker. 

The balance on the card is at thelimit.  The other problem is that this is they only credit card he has.  I don't want to take it from him because he has been fairly responsible on it besides his two late payments and keeping it at the max. Should I suggest that he opens a card by himself so I can clean this one up?  I agree that closing it is a bad idea.

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Well.. He couple probably easily get one of the starter or rebuilder cards... Or, he can always open up a secured card with a similar limit. Then you both will get the benefit from a paid to 0 credit card, he can continue to build and potentially get a prime card after those lates fade a little bit. As well as you, you will have the benefit of two open trade lines, one 5+years old, and might be right to apply for a better card once you tackle the rst of the negs on your report.

Revovling debt in terms of credit card, from the best of my understanding, do not factor cosiging the same way as a loan. So my best guess is, the account is technically a joint. How they report in the comments is less important than how it is coded, but if you are listed a cosigner and not joint, I still think you are responsible for the debt, and therefor, cannot make yourself and AU and have it removed.

-scott

[gambleforlove04]

I'm going to follow your advice and have a discussion with my brother.  Thank you for your help!