I had the opportunity to work with Sam on her first credit card application recently. Sam is a 23 year old college grad and never had any credit in her own name. BUT her parents put her on their American Express card as an authorized user and has been on that card for numerous years.
Here is the good: It gave Sam a credit score of 740 just being the authorized user.
And the bad: At the moment she applied for her first card, a Chase Sapphire Preferred card, there was a $12,000 balance, she knew nothing about on that American Express that belonged to her parents.
When I met with Sam it had been several days since her application and she was waiting on a response. I suggested we make a call to the reconsideration line to check the status of her first application. After she provided the normal security info was provided, and I was listening on the call via speakerphone, Sam was told she was denied because of the high balance on the Amex card she was an authorized user on. The look on her face showed extreme disappointment but I reassured her we would be OK.
We reiterated to the credit analyst that Sam was only an authorized user in regards to the $12K balance and not legally responsible for the debt, that she was a college educated individual working in her field, lived at home with no expense and the analyst had her income on the application. After a short hold the analyst came back to inform Sam she was recommending her for a $5,000 credit approval and to expect a document in the mail which we assume was to verify income and address.
We worked our way past the balance on the parent’s card but I want you to be aware that being an authorized user is not always the best way to go. I think in this instance for Sam, it got her a score which let her start in the game and presented a hurdle we had to overcome. Now that Sam is in the game, we’ll try to keep her away from authorized users in the future.
UPDATE: Yep, Sam got her approval
Possible exception: Howie made a great suggestion last week for those of you struggling to find Vanilla Reload cards. Do you have a very, very,very good friend, you trust to become an authorized user in a location where Vanilla Reloads are available?
Congratulations to Rene at Delta Points on his One Year Blog Anniversary
“Rene has been a FTG supporter for years and I’m glad to have him as a blogger brethren member this last year. In addition to great content on a unique topic, his attitude is always positive and his uplifting enthusiasm for the travel space has been welcomed by all.
Way to go Rene and keep those posts coming.”
IHG® Rewards Club Select Credit Card
- Annual Fee: $49 fee waived for the first year
- Foreign Fees: No
- Card Type: Hotel
The IHG Rewards Club Visa is often cited as one of the most underrated hotel credit cards, with good reason. The official offer is for 70,000 points after $1,000 spent within three months, with the first year’s fee waived. The card comes with an annual free night certificate that can be used at any IHG property, including Intercontinental hotels - making this certificate worth upwards of 50,000 points. This is far more generous than some other hotel cards, which limit the categories in which free night certificates can be redeemed.
Cardholders earn 5 points per dollar at IHG hotels; 2 points per dollar at gas stations, grocery stores, and restaurants; 1 point per dollar everywhere else. Moreover, you’ll get a 10% rebate on award redemptions, up to 100,000 points per year. The card also comes with Platinum status, though that doesn’t get you much with IHG. Still, this is a fantastic card to have in your wallet, with benefits that far outweigh the already low $49 annual fee.
- Earn 70,000 bonus points after you spend $1,000 in the first 3 months of account opening
- Enjoy a free night of card membership at over 4,700 hotels worldwide
- Earn 5 points for each $1 spent at our hotels
- Earn 2 points per $1 spent on purchases at gas stations, grocery stores and restaurants
- Bonus points redeemable at hotels such as Intercontinental® Hotels & Resorts, Crowne Plaza® Hotels & Resorts and Holiday Inn®
- Automatic platinum elite status, as long as you remain a cardmember
- $0 introductory annual fee the first year, then $49