Credit cards: What’s the difference between a co-signer and an authorized user?

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Sarah Gage

Published on October 20, 2023 | 4 min read

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Key takeaways

A credit card co-signer is someone who agrees to be legally responsible for repayment of a debt. However, few credit card issuers actually allow co-signers on their card products.
Authorized users get access to their own physical card they can use, yet they are not legally responsible for repaying charges. Unlike co-signers, most card issuers allow authorized user accounts on their cards.
Knowing the differences between a co-signer and an authorized user can help you figure out the best way to build credit with someone you trust.

When it comes to building credit on your own or with another person, plenty of confusing terms can come into play. This includes the terms credit “co-signer” and “authorized user,” which are often used interchangeably.

That said, being a credit card co-signer is not the same as an authorized user, so you’ll want to know the differences and what they mean.

What does it mean to be a co-signer?

Being a credit card co-signer is like being a co-signer on any other type of loan. Credit card co-signers are people who agree to take on responsibility for repayment of debts together, even if the other person involved refuses to pay.

If two people decide to go in on a credit card together, this actually means that both parties are legally responsible for paying the money back. Further, not paying it back can lead to significant damage to the credit of both parties, as well as other financial consequences.

When do you need a co-signer?

Someone who doesn’t have the credit score to get a credit card — or, at least, doesn’t have the card they want — may ask someone to co-sign for them. For example, someone with imperfect credit who doesn’t want a secured credit card may try to get another person with good to excellent credit to use their solid credit standing to help them out.

This being said, someone who has good to excellent credit, or a FICO score of at least 670, may find they can easily qualify for a good credit card on their own. There are even unsecured credit cards for fair credit available, which are geared to consumers with FICO Scores from 580 to 669.

Considerations before co-signing for someone else

One major consideration before asking someone to co-sign on a credit card is the fact that few cards and card issuers actually allow this option. For example, the Apple Card allows joint credit card accounts through its Apple Card Family program. You can also add a co-signer to some Bank of America and U.S. Bank credit card accounts after a primary cardholder is approved.

In addition to the fact card options are limited, you’ll also want to make sure you have a considerable amount of trust with the person you’re asking to co-sign (or the person you’re co-signing for). If either one of you makes charges and refuses to pay, the other one will be on the hook for the bill. This has the potential to strain a relationship and can even lead to credit score damage and financial hardship if one person racks up a considerable dollar amount in charges then disappears.

What does it mean to be an authorized user?

Where a co-signer is someone who is jointly responsible for repayment of a debt, an authorized user is someone who gets their own physical credit card but is not legally responsible for paying back their charges. In fact, the primary account holder that added an authorized user agrees to repay every dollar in charges made by their account and the authorized user, including interest charges and fees.

Authorized user cards are commonly used for teenagers and young adults in college for this reason. For example, a parent may want to give their child a credit card they can use for daily spending or emergency expenses that pop up when they’re away from home. Many spouses also add each other as an authorized user on their credit card accounts so they can both earn rewards on purchases together.

When does it make sense to be an authorized user?

Being an authorized user makes sense when someone cannot qualify for their own credit card account quite yet, either because they don’t have an income or they have no credit or very limited credit. Being an authorized user can also make sense when someone has poor credit due to mistakes they made in the past, but still want to use a credit card for regular spending.

Just remember that authorized users can make significant purchases and simply walk away from the bill without any legal or financial consequences. Given that, authorized users should only be added to a primary cardholder’s account in specific circumstances, such as a parent adding a child or two people who have reason to trust each other completely.

If you’re wanting to become an authorized user on another person’s account, you should also know that any rewards you earn will belong to the primary cardholder. This can be a major downside to being an authorized user if you were hoping to earn cash back or other rewards to spend as you want.

The bottom line

Sharing financial responsibility with another person is a big deal, but how you choose to go about it can determine what your risks and responsibilities are.

For example, getting a joint credit card with another person or co-signing on a card means that both of you are legally responsible for repayment of the debt. Meanwhile, authorized users get the benefit of building credit with a card without having to take on the legal responsibility of repaying the amounts they charge.

In either scenario, credit cards can be a valuable financial tool that helps users to build credit over time. By choosing between co-signing on a credit card or being an authorized user, you can decide what role you want to play — and what responsibility you’ll take on for others in your life.