What is Credit Card Piggybacking?

Bank card piggybacking is if you add another person as a certified person to assist them enhance their credit score historical past and thus their credit score rating.

Including somebody as a certified person is free and they’re going to see that credit score line seem on their report, which may help enhance it.

Do not forget that the FICO credit score rating is made up for 5 elements:

For those who 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 pastwhich make up 50% of the rating.

The individual you add would not have to 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 Categorical – 13
• Barclays – 13
• Uncover – 15
• U.S. Financial institution – 13

The next banks don’t checklist 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’s an age requirement.

Some banks is not going to report the bank card for licensed customers except they’re a sure age. American Categorical 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 might 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’ll discontinue reporting on the Further Card Member’s Card to be able to retain constructive historical past on the Further Card Member.

Are there downsides to credit score piggybacking?

If you don’t give the licensed person their card, there’s zero draw back.

For those who do, the chance is that you’re accountable for their spending. They could have been added as a certified person however it’s nonetheless your bank card – you might be accountable for the debt and never the individual that you added. If they do not have the cardboard, or the variety of the cardboard, there isn’t a threat.

Don’t pay for credit score piggybacking

There are some credit score restore firms who will declare that this technique is fool-proof and in a way they’re right, there isn’t any threat to doing this and it is possible to assist.

There isn’t any assure.

Many firms 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 common credit score line issue is a median, so including one card when you might have 5 dangerous ones will not be going to have a big effect.

Including a certified person

Including a certified person is very easy – simply log into the issuer’s web site and it is often someplace below Accounts or Account providers. Right here it’s in Chase:

You have to a restricted set of private data so as to add a certified person. For Chase, you do not even want their Social Safety Quantity however they’ll nonetheless report it to the bureaus.