No one is born with credit. Credit is something you need to build on your own. A very common way of how people jump start their credit is through a method called piggybacking credit.
Piggybacking credit is basically having someone add you as an authorized user on one of their credit cards in order to pass over some credit juice to you so that you can jump-start your credit.
How does piggybacking credit work?
Once you’re added as an AU (authorized user) on someone else’s account, the credit card issuer will report the credit card on your report to the 3 credit bureaus, with all the credit history. So, let’s say you’re added as an AU to a credit card account that was opened 10 years ago. Your credit report will suddenly show that you have already built credit for 10 years! This may seem funny, but it’s a fact!
In order to be successful with piggybacking credit, make sure the card you’re being added to has the following requirements
- The card is at least two years old
- The card does not have any late payments
- The card does not have high balances
- The card was used recently
Does Piggybacking work with all credit cards?
Not every bank will report an AU to the credit bureaus, and not all banks will report the complete history (back dates).
Check out this list.
| Reports to the credit bureaus | Backdates the history | Notes | |
| Amex | Yes | No | Make sure to add your social security number (can be done online as well) |
| Barclays | Yes | Yes | Do it by phone and request to also add the social security number |
| Bank Of America | Yes | Yes | Do it by phone and request to also add the social security number |
| Chase | Sometimes | Yes | Chase will only report the authorized user if they can match up in their own system a relationship between the primary and the AU. |
| Citi | Yes | Yes | Do it by phone and request to also add the social security number |
| Capital One | Yes | Yes | Make sure to add your social security number (can be done online as well) |
| Discover | Yes | Yes | Make sure to add your social security number (can be done online as well) |
| HSBC | No | No | |
| US Bank | Yes | Yes |
When being added as an AU, try to use your own address- not the primary cardholder’s address. Because the address used will be the address that will show up on your credit report.
At what age can I add my child as an authorized user?
The minimum age needed to be added as an authorized user to your accounts depends on the rules set by each credit card issuer.
Here is a list.
| Minimum Age | |
| Amex | 13 years old |
| Barclay | 13 years old |
| Bank of America | No minimum age |
| Chase | No minimum age |
| Citi | No minimum age |
| Capital One | No minimum age |
| Discover | 15 years old |
| US Bank | 16 years old |
| Wells Fargo | No minimum age |
Did FICO stop piggybacking credit?
FICO (the company which created the scoring models used by most lenders) did not like piggybacking. The reasoning behind their dislike of piggybacking is very simple; Piggybacking allows consumers who do not deserve a higher credit score to fool the system. They pay a few dollars to some company to get added to an account and reap credit benefits.
Therefore, in the newer scoring models starting from FICO 08, FICO stopped counting in accounts on which you are only an authorized user.
FICO does have a legal obligation under the Equal Credit Opportunity Act to allow piggybacking. FICO claims to have a way of knowing if the piggybacking is from a legitimate source or from an unrelated third party.
Does piggybacking credit work to get approved for a credit card?
But even if you do see your Fico score shoot up due to piggybacking credit, don’t expect to get approved for any high end credit card. Banks can see on your credit report that your credit score is based on authorized users and therefore will not count it. In most cases, piggybacking credit will only work to jump-start your credit in order to give you a better chance to get approved for a low end first credit card like the Capital One Journey or Discover It.
Does piggybacking credit work to get approved for an auto loan?
Auto loans will have the same issue as credit cards. The banks will see that the credit is built only on authorized users and will in most cases decline the loan.
Does piggybacking credit work to get approved for a mortgage?
The only sweet spots are mortgage loans. Mortgage loans still use the older FICO scoring models which still factor in authorized users in the scoring model . Therefore, piggybacking credit still works to build your score when applying for a mortgage.
But keep in mind that if you do not have any of your own credit cards on your credit report then some banks will decline the application due to underwriting guidelines. If you’re dealing with a mortgage broker, make sure they are aware that your credit score is built on authorized users only and they should only shop your mortgage at banks that will approve such a type of credit file.
Conclusion
Getting added as an authorized user on someone’s credit card is a great way to jump start your credit. But never rely only on authorized users. Make sure to also get at least two of your own credit cards so you start building your own, solid credit file.
Good luck building credit!
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