How to Close Your Authorized User’s Credit Card Without Compromising Your Credit Score
By becoming an authorized user of someone else’s credit card, you will receive many more benefits than being able to switch to someone else’s credit line. This is one of the easiest ways to quickly create your credit report history if you are just starting out with credit . But what if you reach a point in your life where you want to spread your wings and take control of your credit score on your own?
It is not difficult to close an authorized user account, but it can affect your credit report and your account.
“As an authorized user, you are not responsible for making credit card payments,” explained Megan Horner, credit card publisher at Finder.com . “However, most issuers report authorized users to credit bureaus, so linking to an account will affect your credit score.”
This is why you must strategize before you sever ties with this account.
First, it helps you understand that it probably won’t hurt you to be tied to someone else’s credit account, ”said Rod Griffin, director of public education at Experian . You might not want to close your authorized user account at all. For example, if your parent added you as a logged in user many years ago and you still have a good relationship with the parent, you can just stay.
The reason to stay is because all of the Authorized User Benefits have been removed from your credit history. And if you don’t have enough of your own history, your credit score may drop.
If you have another credit card and have opened one in the past year or two, Griffin may not recommend getting rid of that account because your credit history will still be short. But if you have had multiple other accounts over the years and have managed them well, losing your Authorized User Card is unlikely to affect your account.
On the other hand, suppose you have other credit cards, but have significant account balances. If you give up as an authorized user, “you will lose your available credit limit, and thus your utilization rate will rise,” Griffin explained.
If you don’t need it or don’t want it, you can ask to remove it from your account. The process depends on the lender. You can request the closure of this authorized user account, but in some cases the primary account holder will have to request this for you.
If you want to minimize the impact of closing an authorized account on your credit score, the utilization rate should be as close to zero as possible. You can do this by paying off any balances you have. If you can’t reset your balance to zero right away but still want to switch, Horner recommended asking for an increase in your credit limit if your accounts have a good track record. This will reduce the utilization rate without having to open a new card.
You can also use the Points Simulator to find out what might happen if you delete the oldest credit score from your report. Credit Karma , for example, offers users the TransUnion scoring simulator.
One important thing to remember before you do anything is that you want to allow time for this account to stabilize before you make your next major purchase or financial move. Before making this request, consider what purchases you might be planning for the next three to six months, or even next year.
The reason is simple: “You don’t want your bill to fluctuate,” Griffin said. If you are planning to make a large purchase, Griffin recommends leaving the authorized account alone until you complete the process.