Bad Credit Rating Impliatons: Additional Card Holder For Mother?

katym72

I have a bad credit rating. My mother doesn't.

My Mother wants to put my name on her credit card. I don't want her to discover I have bad credit. But, I am going to the USA for weeks for an internship and a credit card would be useful for emergencies ...

Will the credit card company disallow her from putting me on her card as an extra name because of bad credit or wlill they not bother to check?

jonesMUFCforever

They might do a check to see that you are not bankrupt but as other poster suggests they won't do a full credit search.

smithja

They are unlikely to have a problem adding you on, what happens next though is that you have a financial connection and it is reported to the credit reference agencies. So next time your Mum applies for credit or looks at her file she is going to get yours too, and as more and more lenders are doing monthly checks or have an automatic feed her credit score is going to go down (which could result in her limits being reduces and APR going up, or with Next Directory they send out letters telling people we are no longer doing business with you, your credit limit is now £0). I was planning on doing the same until I was told this was the case, so I would advise you to check before going ahead with it. A better alternative is to buy a prepaid Mastercard like Cashplus (it is one of the few embossed cards and works in places were others dont), you can get it with any amount of bad debt, you top it up like a pay and go mobile phone and use it up to and possibley over your balance if you are not watching your spending. James

YorkshireBoy

smithja wrote: »

...what happens next though is that you have a financial connection and it is reported to the credit reference agencies. So next time your Mum applies for credit or looks at her file she is going to get yours too.

That's absolutely not true James.

There is no 'joint and several' liability with a credit card. The primary cardholder has sole responsibility for any debt placed on the card by the secondary cardholder.

smithja

no, but they have a financial link to one another as far as the bank is concerned. I have been advised by two banks now it would happen, then I found out that one of those companies that tries to get your credit file repaired advises you if you have no credit record to get a friend with a good one to ask for an additional card for an then the files become linked and you get a good score too. This link is not invalidated by the "opt out" in a credit search, an associate is an associate. I would advise the OP to call the bank and ask. It is in the personal information box on every credit agreement I have seen recently, joint and several liability, and credit reference agencies and finanical associations are not one and the same. James

smithja

"Information held about you by the credit reference agencies may already be linked to records relating to one or more people with whom you have a financial association. For any searches we make you may be treated as linked to them and you will be assessed with reference to their records.Information that is supplied to us will be sent to the credit reference agencies"I have been told by the banks a financial association is created by the issuing of an additional card. I am only quoting what I have been told, they record it because if you have a financial association with someone with a bad record it is more likely statistically you are going to end up in debt too. James

YorkshireBoy

James,

I suggest you read Experian's 'Your credit report explained' booklet, which explains how associations are created, and maintained (see page 6). This is supplied with your £2 statutory report, but can also be viewed/downloaded from the Experian website.

smithja

I have read it plenty of times and I understand exactly where you are coming from. However, all I am saying is I have been told this will occur, there is no need for a joint application as such, the join in this agreement, the addtional cardholder is enough to create one. I am a member of Credit Dxpert I will call and ask them tomorrow, and I shall let you know what they say. In the meantime this is what their defintion of association is "A financial connection between two individuals resulting from a joint court judgment, joint account or a joint application for credit. A credit report will include the names of anybody with whom you have a financial connection." It is the last part that the card companies use to create the link, so I have been told. I am also well aware from that defintion it my statement does not make sense. James

dazza.mk

To take your quote an additional cardholder is neither "a joint account" or "a joint credit application", the additional credit card I hold on my wife's credit card account does not appear on my credit report and similarly an additional card on my wccount doesn't appear on hers. The only things that do appear is the bank account with overdrft (joint account) and loan application that was made in both names.

bestyman

Im with Yorkshire boy on this one . My wife has a credit card with me on it . We do not appear on each others credit files ( experian)

smithja

I was told it is not the actual account details that appear on your file, it is a simple association between the two people at the address of the principle card holder that is created. If it is correct when you are searched as an additional cardholder, the principal cardholders data is divulged too. After I posted it I went away and read some T&C's and HSBC and RBS Group card both given the impression this occurs, they state something of the order "anything like a joint application". I also found something called the Finance and Leasing Association who categorically state the banks that do share the information in the way I described to look for problems where an additional cardholder may be a problem (even although they have not in most cases given their consent for this to happen), Barclaycard, the Co-op, and Egg are on the list, and it is happening now. I will try and post the link later. James
Edit: This is RBS/NatWest's current credit card T&C's on the subject "Credit reference agencies (j) A link between you and anyone with whom you have a joint account or similar financial association will be recorded at credit reference agencies, creating a 'financial association'. All parties' information will be taken into account in future applications until one of you successfully files a 'notice of disassociation' at the credit reference agencies. (k) We may make periodic searches of and provide information (including how you manage your account and any arrears) to, credit reference agencies and the Group to manage and take decisions about your account. Such information may be used by other credit providers to take decisions about you and your financial associates. "