Bank card piggybacking is while you add another person as a certified consumer to assist them enhance their credit score historical past and thus their credit score rating.
Including somebody as a certified consumer is free and they’ll see that credit score line seem on their report, which may also help enhance it.
Do not forget that the FICO credit score rating is made up for 5 elements:
In the event you add in a brand new credit score line with an extended historical past of on-time funds, you assist enhance Size of Credit score Historical past in addition to Cost Historical past, which make up 50% of the rating.
The individual you add would not must get the cardboard itself. Simply including them will confer the advantages.
Minimal ages for licensed customers
Some issuers have a minimal age for licensed customers:
- American Specific – 13
- Barclays – 13
- Uncover – 15
- U.S. Financial institution – 13
The next banks don’t record an age – Financial institution of America, Capital One, Chase, Citi, Wells Fargo, and USAA.
If you wish to assist somebody, discover your oldest bank card and discover out if there may be an age requirement.
Some banks won’t report the bank card for licensed customers except they’re a sure age. American Specific explains of their FAQ on Further Card Members (emphasis mine):
Q. How does the Further Card Member set up credit score?
A. Credit score data will probably be offered to the credit score bureau for the Further Card Member when they’re 18 or older. The Further Card Member builds solely constructive credit score historical past primarily based on the credit score conduct of the Fundamental Card Member. If the Fundamental Card Member turns into delinquent at any level, we are going to discontinue reporting on the Further Card Member’s Card as a way to retain constructive historical past on the Further Card Member.
Are there downsides to credit score piggybacking?
If you don’t give the licensed consumer their card, there may be zero draw back.
In the event you do, the danger is that you’re liable for their spending. They might have been added as a certified consumer however it’s nonetheless your bank card – you might be liable for the debt and never the person who you added. If they do not have the cardboard, or the variety of the cardboard, there isn’t any threat.
Don’t pay for credit score piggybacking
There are some credit score restore corporations who will declare that this technique is fool-proof and in a way they’re right, there is no threat to doing this and it is probably to assist.
There is no such thing as a assure.
Many corporations have settled with the FTC for promising this.
It is part of your rating but when your historical past is lengthy and usually dangerous, including a further credit score line is unlikely to enhance your rating considerably. The typical credit score line issue is a median, so including one card when you’ve got 5 dangerous ones isn’t going to have a huge impact.
Including a certified consumer
Including a certified consumer is very easy – simply log into the issuer’s web site and it is normally someplace beneath Accounts or Account providers. Right here it’s in Chase:
You’ll need a restricted set of non-public data so as to add a certified consumer. For Chase, you do not even want their Social Safety Quantity however they’ll nonetheless report it to the bureaus.
