I’m an Authorized User and the Primary Cardholder Is Making Late Payments – Help!

If you discover the primary cardholder is a total deadbeat, you can call the issuer and have your name removed as an authorized user.

Lindsay KonskoAugust 12, 2014
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Let’s say some kind family member or spouse has a credit card, and they make you an authorized user. Then you discover as the authorized user that the primary cardholder is making late payments. Is it time for a down-home family feud? Is this the end of your great relationship?

Being an authorized user can create short-term problems if the primary cardholder is making late payments. But don't panic. This is easily fixed.

Authorized users are not held liable

The good news is that most credit cards do not hold an authorized user responsible for any debt incurred on the card. However, not being financially responsible is different from not having delinquent payments reported to the credit bureaus, and harming the authorized user’s credit score. In fact, that will likely happen. Negative information will be supplied to the credit bureaus and your credit score will go down.

Get it fixed

If you are indeed an authorized user and the primary cardholder is making late payments, don’t panic. You can have these negative reports taken off your credit report. First, call all three credit bureaus and open a dispute. All you have to do is tell them the situation and that the primary cardholder is making late payments. It will take 30 days or so, but these late payments should be removed.

You’ll want to be particularly diligent about this if you’ve been building good credit as an authorized user and are about to apply for some kind of credit on your own. You don’t want this to throw a wrench into all your hard work.

Pros and cons of authorized usage

This is the double-edged sword of authorized-user status. As long as the primary cardholder is being responsible, all that good credit information flows onto your credit report as an authorized user. However, the negative stuff flows on there, too, unless you dispute it.

If you discover the primary cardholder is a total deadbeat, you can also call the issuer and have your name removed as an authorized user. It should only take a few days, and the issuer will cease making reports under your name to credit bureaus. At some point, that account should vanish from the report entirely. Just remember that doing so removes both good and bad information from your credit report.

It’s tempting to just jump on board as an authorized user, but be sure to vet the primary cardholder or you may end up with a big headache.

Authorized user vs. cosigner

There’s one other important distinction worth mentioning. Being an authorized user is totally different than being a cosigner. In the latter case, the cosignor shares liability both jointly and severally with the actual cardholder. In other words, you are completely liable for paying the card off — even if the cardholder charges up a storm and runs off without paying a dime, you are liable for the entire balance.

Even worse, your credit report is tied to whatever transpires with that card. If it’s paid on time, then your score goes up. If the cardholder is delinquent or runs off, and you don’t make good, your score will go down. So beware of taking on the cosigner position!