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One of my rewards-related routines is checking out my Credit Karma account on a weekly basis. By doing so, I can keep track of my estimated TransUnion and Equifax credit scores, while also making sure that the information reflected on my credit score remains accurate.
Recently, I noticed something while accessing my Credit Karma account. It appeared that my Equifax score had gone down by a few points for no apparent reason, given nothing had happened that would warrant my score going down. When trying to decipher what had caused the decrease in my score, I noticed two accounts that I did not recognize had increased my total credit card balance by about $5,000, which in turn increased my credit card utilization ratio by a couple of percentage points.
The credit card utilization ratio is one of the most important factors considered when determining your credit score. It constitutes the ratio between your total credit card balance and your total credit card limit. In other words, if your total credit card balance is $5,000 and your total credit limit is $100,000, your credit utilization ratio is 5%, which is considered excellent.
When looking into the account details for both of the accounts, I did not recognize I noticed that they had both been issued by Chase and that I was an “authorized user” on both accounts. Here is snapshot of the details for both cards:
Up to that point, I had never noticed any account on which I was an authorized user on my credit report. I was an authorized user on some my wife's Chase accounts, but the dates on which these accounts were opened did not match the dates on which any of my wife's accounts were opened. In fact, I was able to confirm that none of my wife's accounts on which I am an authorized user appeared on my credit report.
I proceeded to give Chase a call to see if they could provide more information regarding the two accounts in question. Eventually, we were able to figure out that one belonged to my sister, while the other belonged to my mother. I had completely forgotten that I was an authorized user on both of these accounts. Since they appeared to be having a negative impact on my credit, I asked if there was anything that could be done.
Chase customer service was extremely helpful. They removed me as an authorized user from these accounts on their end and told me they would contact the three credit bureaus to inform them that I was no longer a part of these accounts. A couple of weeks later I was able to confirm that both of these accounts were no longer showing up on my credit reports.
When Does a Credit Card Account on Which You Are an Authorized User Show up on Your Credit?
I have always been aware that credit card accounts on which you are an authorized user can show up on your credit. However, I had always assumed this only happened when your social security number was provided when requesting your authorized user card. That is why I always avoid providing my wife's social security number when adding her to one of my accounts and ask her to do the same for her accounts. Even though some issuers, for business cards, will request social security numbers when you try to add an authorized user, if you say you do not have it they will still issue the authorized user card.
When I asked Chase how these accounts could have been tied to me without my social security number they mentioned that they were likely able to do it because of the addresses associated with our credit histories. While currently my sister, mother and I all have different billing addresses, at some point we have all used the same address.
I used to think that adding an authorized user to a credit card account had no impact on the authorized user's credit report as long as a social security number was not provided to add the authorized user. Clearly, that is not the case. While in some instances you might improve your credit scores as a result of an authorized user status on a credit card account, in most cases it is likely better to avoid the mere possibility of your credit score being negatively impacted by a credit card account for which you have little to no control over.
I used to add my wife to all of my credit card accounts and vice-versa. I will no longer do this unless it is necessary to enjoy some of a card's benefits.
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