Yes, it's possible to be added as an "authorized user" to your parent's credit card account. As an authorized user, you will have access to your parent's credit line (or a subset of, if they limit you) and be able to view your purchase history and make payments online. However, you will not be legally responsible (not now or after you turn 18) for the account. The account's trade line (that is, the date it was opened, the outstanding balance, available credit and the payment history) is reported to your credit report by default but you may restrict this (however, portions will still be reported).
Changes made to the FICO model several years ago are suppose to ignore authorized user accounts in scoring (in other words, it will no longer help or hurt you). However, be aware that many automated in-house scoring systems and people doing manual reviews fail to take this in account by default. I was an authorized user on an account in which the person ultimately drove the balance over $100,000 with crappy payment history. I wasn't aware of this (the person previous did not carry a balance and had pristine payment history) until a potential employer disqualified me.
|Quoting einsteinboricua (Reply 6):|
Also, if a bank issues a minor a credit card (for students), the limit is rarely over $500 and the parent must cosign and be responsible to pick up the tab should the child fail to pay up. Our regional bank issues college students a Visa with around $300-$500 in credit, and the limit is subjected to the parent's credit rating. This is assuming the student is unemployed and is a dependent. US Bank, in Seattle, issued me a credit line of $600 (which I was surprised), and I have thus far kept up with payments.
Credit unions tend to forgo the co-signer if the person applying for credit has had a relationship with them. Also, secured credit cards tailored for young adults (that is, you deposit money with the company into an interest-earning CD
or savings account and receive credit against the amount) forgo the co-signer - and often graduate quickly.
I received a student credit card in 2000 (when I was 18) with an initial credit limit of $1,500. It grew to over $20,000 in just a few years (without income verification) and carried an interest rate near 30% and annual fee of $95. There was a double-monthly average balance for interest calculation (wipes out the grace period) and a fee of $10 per payment made online or $15 via check. I worried about the impact on ditching the card (since it was among my first; history is a big part of FICO) but bit the bullet in 2008.
Read the T&C carefully!!!!
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