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What's the differerence between a joint account holder and an authorized user?


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There are two ways you can add another credit card user to your credit card account - as an authorized user on the account or as a joint account holder.


In both cases, both people on the credit card account can make charges to the card. There's one credit limit, one balance, one payment, and one due date. Each person's credit card activity affects the other, even when it comes to credit reporting.

Key Differences

The major difference between an authorized user and a joint account holder is the legal obligation to pay the credit card balance.

An authorized user has no legal obligation to pay back the credit card debt. Though late payments will affect the authorized user's credit history as long as he's on the account, the credit card issuer can't pursue that person for payment.

On the other hand, the joint account holder is as liable for paying back the credit card balance as the primary account holder. The credit card issuer can use all legal methods to go after both people for payment.

In many cases, each joint account holder must meet the credit and income requirements to be added to the account and can be denied if the requirements aren't met. On the other hand, an authorized user can usually be added to an established account regardless of the user's credit history.

How Credit Card Sharing Goes Wrong

A joint account can be problematic if the two accountholders end their relationship, especially if the account still has a balance. You can't easily remove a person from a joint account, even if one person made all the charges on the account. The two of you will have to come up with an amicable way to resolve the balance (like paying it off or transferring the balance) and close the account.

An authorized user can be removed from a credit card with a simple phone call. However, the authorized may not have a legal liability to repay the balance they charged. But, removing the person from the account can keep them from running up a high balance out of spite or revenge.

Sharing a credit card is risky, whether you have a joint account or you've added an authorized user. If you're thinking about getting a credit card with someone, like a child or spouse, consider the legal liability of paying the balance and the ease of ending the credit card relationship to help you decide.

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