Real talk... Does an authorized user tradeline actually help rebuild credit?

[jmcmillan]

OK, so I am a veteran at rebuilding. I am currently on my second rebuild after I filed for bankruptcy last year.

I hear a LOT about putting yourself as an authorized user on someone else’s credit card. I’ve always dismissed this idea, because I don’t believe it’s very beneficial, especially in manual underwriting. However, I recently saw another veteran member mentioning that s/he wish they knew about becoming an authorized user back in the day, so s/he could have avoided predatory rebuilding cards. That made me think… am I missing out?

At the same time, I have noticed my mother has two Chase credit cards that are 15 years old. Should I ask her to add me?

I already have 3 secured credit cards with a $1,000 credit line each.

Edit to add: I don't necessarily need age. I have several cards on my reports that were paid/closed way before my bk. My AAoA is 9 years, and my oldest credit line is 19 years.

[Horseshoez]

@jmcmillan, I'm not much of an advocate for AUs of any stripe and think if one can make do and rebuild without popping the AU genie out of the bottle, so much the better.

[jmcmillan]

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@Horseshoez wrote:

I'm not much of an advocate for AUs of any stripe and think if one can make do and rebuild without popping the AU genie out of the bottle, so much the better.

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That's my feeling, as well. But people on Reddit seem to be obsessed with AUs. I'm skeptical that it would change your life, but I am a big believer in secured credit cards.

[Horseshoez]

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@jmcmillan wrote:

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@Horseshoez wrote:

I'm not much of an advocate for AUs of any stripe and think if one can make do and rebuild without popping the AU genie out of the bottle, so much the better.

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That's my feeling, as well. But people on Reddit seem to be obsessed with AUs. I'm skeptical that it would change your life, but I am a big believer in secured credit cards.

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Agreed, when I started my rebuild last year after my Chapter 13 discharge, I ended up going for a secured card with a $5,000 limit and that one card opened up lots of doors for me and has since graduated to unsecured and up to a Signature Visa.  I rather doubt I would be anywhere near as far along had I gone for an AU versus the secured card.

[draychi]

They are mostly used to lower utilization or to drown out late payments by adding years of payment history. People usually add them to snag a few good cards/account, or when manual underwriting isn't used for a decision. They're really good for thin or new credit files when used for the situations above.

I think the latest FICO model gives AU accounts less value as far as scoring.

[jnbowmar]

They are INCREDIBLY helpful. They establish amounts owed  via utilization (35 percent of of fico, credit age by adding to average age of account and oldest account (15 percent of fico) and contribute to number of account with balances and other scoring metrics. The only reason I can think of were they are not useful is chase doesn't count them internally when considering credit apps .

Otherwise, they the difference between a young or inexperienced person being able to get prime cards and mortgages or being stuck overpaying banks and auto lenders. 

[Shooting-For-800]

I think they help when they are big limits and low utilization.

GL!

[Joobie]

It depends on your situation. If age is what you need, being placed on a credit card with a long, established credit history could definitely help you. If utilization has been an issued with you, being placed on a card with a large spending limit could benefit you. You won't know until you try. They could be very beneficial or they can keep your profile the same.

[gdale6]

AUs are used when you are trying to do an initial build or an initial rebuild when there are no other accounts available to help, this isnt the case for you. I would not become an AU at this point.

[jmcmillan]

Thanks for all of the feedback everyone!