Removing authorized user from credit card

[4kids4karen]

What are the impacts?

I recently started watching DH and my accounts on CreditKarma. I am an AU on one of my sons cards and I notice when he has maxed out the card reflects on my CreditKarma. So the other day when we were both together, we called and had me removed. There was no need for me to be on the card really.

DH and I have one joint account. Really, he uses it as his card. I am thinking of having myself taken off as a joint account holder. Would this be positive on my credit. This card is pretty close to being maxed out as well and currently counts against me for a high balance. DH credit score is better than my credit score, so I am looking at ways to improve my score. I know removing a joint account holder will be different than an authorized user. I may have to call our bank to find out the process.

Anyone every do any clean-ups like this and know the impact? It's not my "oldest" account to worry about. My "oldest" account is an individual account.

 

[4kids4karen]

So my bank said the only way to take my name off of his credit card is to close the account. The interest rate is our second lowest APR card, so I don't want to close it. Transferring it to another card doesn't seem beneficial if the interest rate is going to be higher.

 

[barkley]

I know with some cards an authorized user has no impact (positive or negative) on their credit whatsoever-that's the situation w/ one we put dd on for her college needs and we have only to call and have her removed. NOW if she were a joint holder that's a whole different situation and while we (dh and I) have never been inclined to have one of us removed from any joint ownership cards we've had I recall looking at paperwork when a family member tried to remove someone and it realy came down to the issuer's individual policy-some said 'no problem' while others said the same as yours (and it seemed to depend allot on the balance of the card-if there was a large balance the issuer was hesitant to release a joint holder until the balance was paid in full).

 

[4kids4karen]

I know with some cards an authorized user has no impact (positive or negative) on their credit whatsoever-that's the situation w/ one we put dd on for her college needs and we have only to call and have her removed. NOW if she were a joint holder that's a whole different situation and while we (dh and I) have never been inclined to have one of us removed from any joint ownership cards we've had I recall looking at paperwork when a family member tried to remove someone and it realy came down to the issuer's individual policy-some said 'no problem' while others said the same as yours (and it seemed to depend allot on the balance of the card-if there was a large balance the issuer was hesitant to release a joint holder until the balance was paid in full).

My son's card is a USAA secured card with only a $250 limit, so it stays mostly at that limit. Even if he pays it off, a month later it's like at $199. So that was showing up on Credit Karma. It's still on CreditKarma today but I expect it to fall off.

The joint card (which we refer to as DH card) is also a USAA card and has a low APR. The only lower APR card we have is my USAA card (individual account). So all three are USAA, who we love, so we don't want to cancel either card. It's not a big deal. I am just watching my credit score and trying to find ways to improve it. Most of the accounts that I am snowballing is in DH name only, so his credit score is going up while mine is barely moving. LOL. I did recently open up a Navy Federal credit card in my name only, then I transferred some higher APR accounts to that. Which one was DH individual credit card with Chase (United Airlines) that we no longer were even using. So I absorbed his debt from that card in my name. So that probably didn't help. Right now I am looking to pay off our A/C and that is again in DH name alone. LOL. It's our lowest balance account with a higher APR than our credit cards I mentioned, so that will be paid off by the end of May.

My son is a high school sophomore, so I am trying to pay off some debt and increase our credit scores at the same time in the event we need to look at student loans for him.

 

[coast2coastmickey]

I wouldn't bother worrying about taking yourself off. You'll have more impact on your score by focusing paying it off as quickly as possible. If you're planning on financing a major purchase...then...sure take yourself off...but I'd ask...why are you financing something when you already have debt?

We have many CCs but they're all at 0% utilization, which makes our scores sky high (800s+). How do we do that? I always pay them 100% off BEFORE THE BILL IS GENERATED. How did we do this? Some effort to set aside some money to where we're living on last month's paychecks, and being organized in order to know when my bills are generated.

If you pay off the CCs before the bill is generated, then what gets reported to the bureaus is your 0% balance.

And it goes without saying. If you have credit card debt that is costing you interest and you can't pay it off immediately, that's a signal that you're not living within your means. Hopefully that has changed, that way you can really make progress on the debt.

 

[4kids4karen]

I wouldn't bother worrying about taking yourself off. You'll have more impact on your score by focusing paying it off as quickly as possible. If you're planning on financing a major purchase...then...sure take yourself off...but I'd ask...why are you financing something when you already have debt?

We have many CCs but they're all at 0% utilization, which makes our scores sky high (800s+). How do we do that? I always pay them 100% off BEFORE THE BILL IS GENERATED. How did we do this? Some effort to set aside some money to where we're living on last month's paychecks, and being organized in order to know when my bills are generated.

If you pay off the CCs before the bill is generated, then what gets reported to the bureaus is your 0% balance.

And it goes without saying. If you have credit card debt that is costing you interest and you can't pay it off immediately, that's a signal that you're not living within your means. Hopefully that has changed, that way you can really make progress on the debt.

That is absolutely wonderful that you have many CC with 0% utilization. I am so happy that you have found what works for you and your family's individual situation. Thanks for sharing.

 

[Marionnette]

So my bank said the only way to take my name off of his credit card is to close the account. The interest rate is our second lowest APR card, so I don't want to close it. Transferring it to another card doesn't seem beneficial if the interest rate is going to be higher.

My son's card is a USAA secured card with only a $250 limit, so it stays mostly at that limit. Even if he pays it off, a month later it's like at $199. So that was showing up on Credit Karma. It's still on CreditKarma today but I expect it to fall off.

The joint card (which we refer to as DH card) is also a USAA card and has a low APR. The only lower APR card we have is my USAA card (individual account). So all three are USAA, who we love, so we don't want to cancel either card. It's not a big deal. I am just watching my credit score and trying to find ways to improve it. Most of the accounts that I am snowballing is in DH name only, so his credit score is going up while mine is barely moving. LOL. I did recently open up a Navy Federal credit card in my name only, then I transferred some higher APR accounts to that. Which one was DH individual credit card with Chase (United Airlines) that we no longer were even using. So I absorbed his debt from that card in my name. So that probably didn't help. Right now I am looking to pay off our A/C and that is again in DH name alone. LOL. It's our lowest balance account with a higher APR than our credit cards I mentioned, so that will be paid off by the end of May.

My son is a high school sophomore, so I am trying to pay off some debt and increase our credit scores at the same time in the event we need to look at student loans for him.

That is absolutely wonderful that you have many CC with 0% utilization. I am so happy that you have found what works for you and your family's individual situation. Thanks for sharing.

Canceling cards will only make your credit score go down. The reason being that when you cancel a card that has a zero balance, your debt-to-credit ratio goes up. IOW, let's say you owe a total of $10K on all of your cards but have $50K in available credit across all of those cards. Your debt/credit ratio is 1:5 (20%). Now imagine that you cancel a card that you're not using (maybe because it has an annual fee that you don't want to pay) and it has a credit limit of $10K. Your debt/credit becomes 1:4 (25%). That lowers your score. Length of credit history is also a factor. You don't want to cancel a card that you've had forever, even if you're not using it.

There are a few ways to improve your score. First, avoid any hard pulls on your credit. Car loans, new credit cards for the bonus miles, a personal loan application will all result in a hard pull. Next, pay on time, every time. Late payments not only go against your credit rating, they also result in late penalties. And payment history accounts for 35% of your credit score. Third, pay more than the minimum due each month.

But ultimately, the biggest impact will be made by reducing the amount of debt that you now have. But I think you already knew that.

 

[4kids4karen]

Canceling cards will only make your credit score go down. The reason being that when you cancel a card that has a zero balance, your debt-to-credit ratio goes up. IOW, let's say you owe a total of $10K on all of your cards but have $50K in available credit across all of those cards. Your debt/credit ratio is 1:5 (20%). Now imagine that you cancel a card that you're not using (maybe because it has an annual fee that you don't want to pay) and it has a credit limit of $10K. Your debt/credit becomes 1:4 (25%). That lowers your score. Length of credit history is also a factor. You don't want to cancel a card that you've had forever, even if you're not using it.

There are a few ways to improve your score. First, avoid any hard pulls on your credit. Car loans, new credit cards for the bonus miles, a personal loan application will all result in a hard pull. Next, pay on time, every time. Late payments not only go against your credit rating, they also result in late penalties. And payment history accounts for 35% of your credit score. Third, pay more than the minimum due each month.

But ultimately, the biggest impact will be made by reducing the amount of debt that you now have. But I think you already knew that.

I have no intentions of canceling any of the cards I spoke about, I said the opposite, I am keeping those cards. I have in the past 12 months cancelled cards and accounts after paying them off, and I am fine with the credit hit for that. Actually, the cards/accounts I closed were under DH name and his score has since went up. A dip is fine, we are planning for the future, not anything immediate.

 

[Marionnette]

I have no intentions of canceling any of the cards I spoke about, I said the opposite, I am keeping those cards. I have in the past 12 months cancelled cards and accounts after paying them off, and I am fine with the credit hit for that. Actually, the cards/accounts I closed were under DH name and his score has since went up. A dip is fine, we are planning for the future, not anything immediate.

You ignored the rest of my post and only focused on the part about canceling existing cards. I must have misunderstood your post from this morning on the "I love credit cards" thread. It gave the impression that you were considering cancelling your Southwest CC.

 

[4kids4karen]

You ignored the rest of my post and only focused on the part about canceling existing cards. I must have misunderstood your post from this morning on the "I love credit cards" thread. It gave the impression that you were considering cancelling your Southwest CC.

That is a different post completely that has a separate topic. I was hoping someone on that thread might reply telling me some benefits of the card that maybe wasn't obvious on their website. That card is an individual card (my name only) that has a zero balance. I just paid the $99 annual fee on the SW card that I do not use. I did call to cancel that card months ago at the same time as I canx other card/account so the credit dip would all be at once, but because of the points I have, I will be able to get two free tickets for our holiday trip. After that trip, I do not see the benefits of keeping the card. I didn't mention the SW card on this thread, because this thread was about removing authorized users/joint account holders (not canx) and the other thread talks about benefits/points/rewards of different cards. To me those are two different topics.

 

[supersnoop]

So my bank said the only way to take my name off of his credit card is to close the account. The interest rate is our second lowest APR card, so I don't want to close it. Transferring it to another card doesn't seem beneficial if the interest rate is going to be higher.

That doesn't sound like an authorized user; that sounds like a joint account holder or co-signer.

When you're an authorized user, you're allowed to spend money, but you aren't legally responsible for paying it back; the account owner is. It sounds like your son wouldn't have qualified to take on that risk, so the bank wanted someone else, a co-signer, to be on the hook for the payments, too. They aren't cool with just the one person on the account.

For a true authorized user, there should be no impact on your credit because it is neither an indication of your creditworthiness nor your legal responsibility.

 

[platamama]

For a true authorized user, there should be no impact on your credit because it is neither an indication of your creditworthiness nor your legal responsibility.

I removed myself as an authorized user from one of DH's credit cards a few weeks ago. I've been checking my Experian report periodically since then, and today that card no longer shows up on my Experian account. Poof, it vanished. Doesn't show up as an open account, doesn't show up as a closed account, it's just gone. I think that if it's on your report from a credit agency, then it does impact your credit, even if you're not legally responsible for paying it.

 

[gottalovepluto]

...DH and I have one joint account. Really, he uses it as his card. I am thinking of having myself taken off as a joint account holder...

That’s not possible. A joint account was granted to you and your DH together. The bank that holds the credit card gave it to you after analyzing both of you and they will absolutely want to preserve the right to go after both of you if the account is not paid. The only way of getting it off your report is to zero the balance and close it and it will still remain a part of your credit history for some time. Since you have determined that’s not the right path for you you’re stuck with it. At the end of the day this joint card is equally yours even if your husband is the only person to ever use it because as a joint account holder you have legal and fiscal responsibility for the account.

 

[kymom99]

That’s not possible. A joint account was granted to you and your DH together. The bank that holds the credit card gave it to you after analyzing both of you and they will absolutely want to preserve the right to go after both of you if the account is not paid. The only way of getting it off your report is to zero the balance and close it and it will still remain a part of your credit history for some time. Since you have determined that’s not the right path for you you’re stuck with it. At the end of the day this joint card is equally yours even if your husband is the only person to ever use it because as a joint account holder you have legal and fiscal responsibility for the account.

This is true because one time back in the day my dad cosigned for my brother to get a credit card. Years later he wanted to be taken off of it but the bank said it had to be paid in full. My brother had gotten married and they were running up debt. Once my dad passed away my brother asked for a death certificate so he could finally remove his name.

 

[kymom99]

I removed myself as an authorized user from one of DH's credit cards a few weeks ago. I've been checking my Experian report periodically since then, and today that card no longer shows up on my Experian account. Poof, it vanished. Doesn't show up as an open account, doesn't show up as a closed account, it's just gone. I think that if it's on your report from a credit agency, then it does impact your credit, even if you're not legally responsible for paying it.

When I wanted to get my son a card, the lady at our bank suggested a card in my name with him as an authorized user. She said that card would reflect on his credit report and earn him credit. I haven't checked to see if that is indeed the case.

 

[McKelly]

When I wanted to get my son a card, the lady at our bank suggested a card in my name with him as an authorized user. She said that card would reflect on his credit report and earn him credit. I haven't checked to see if that is indeed the case.

This is true because I put my high schooler on as an authorized user when she took school trips so she didn't have to carry so much cash. Now she is in college and she had no trouble getting her own credit card/loans because she had already established credit as an authorized user.

 

[Marionnette]

This is true because I put my high schooler on as an authorized user when she took school trips so she didn't have to carry so much cash. Now she is in college and she had no trouble getting her own credit card/loans because she had already established credit as an authorized user.

Not always true. My older son was an authorized user on my credit card from the time he got his drivers license. When he applied for a car loan he was told that although his credit score was excellent, he had insufficient credit history to secure the loan.

 

[kymom99]

Not always true. My older son was an authorized user on my credit card from the time he got his drivers license. When he applied for a car loan he was told that although his credit score was excellent, he had insufficient credit history to secure the loan.

Right, not all cards work this way. I already had a couple cards he could have been added to but this one supposedly earns him a credit rating. I do need to check though. I have been given misinformation by bank workers before. You should have seen the circus when we tried closing his minor savings account and opening a new student account. It was way more complicated than it needed to be because it was obvious the gal was new at it and didn't quite know what she was doing. But in the end the account worked and we got a receipt for everything.

 

[4kids4karen]

My CreditKarma updated today, removing my son's card. LOL, my score went up 4 points! LOL.

I have some other pending changes not yet posted. I've change some of my strategy. CreditKarma seems to be a good tool, just to glace at once a week or so. The joint card, I just put a big snowball payment on based on CreditKarma suggestion of bringing my debt down xx amount would increase my score to the next level. My strategy before was to pay off the lowest balance (as Dave Ramsey suggests) or the highest interest rate account. The joint card doesn't meet either of those, but since it helps my credit score, I am putting more towards that card. I paid off the A/C yesterday, but that was just in DH name. It's funny when I married DH he brought the debt from his previous marriage and I had one small credit card. Looking at our accounts, it looks like I have more debt but that is because I consolidated accounts to include his one of his cards into one of mine.

 

[mi*vida*loca]

My CreditKarma updated today, removing my son's card. LOL, my score went up 4 points! LOL.

I have some other pending changes not yet posted. I've change some of my strategy. CreditKarma seems to be a good tool, just to glace at once a week or so. The joint card, I just put a big snowball payment on based on CreditKarma suggestion of bringing my debt down xx amount would increase my score to the next level. My strategy before was to pay off the lowest balance (as Dave Ramsey suggests) or the highest interest rate account. The joint card doesn't meet either of those, but since it helps my credit score, I am putting more towards that card. I paid off the A/C yesterday, but that was just in DH name. It's funny when I married DH he brought the debt from his previous marriage and I had one small credit card. Looking at our accounts, it looks like I have more debt but that is because I consolidated accounts to include his one of his cards into one of mine.

I notice CreditKarma is way off. They will give me one score via Transunion but when I check Transunion directly my score is 20-30 points higher.