Women who want to build or improve their credit – particularly those who do not work, are divorced or widowed – often find accessing credit to be challenging. So, if you’re one of these women, it’s imperative that you know how to gain access to and manage credit, and the credit journey starts with building your credit.
An important part of building your credit is understanding user account status designations. Why does that matter? Because some user account status designations are better for building credit. Simply put, the user account status designation lets creditors know not only who can use the account, but also, who is responsible for managing and making payments.
Here’s what you need to know about user account status designations:
Authorized User: If you’re listed as an authorized user on someone else’s account, then you have permission to use the account but no legal responsibility for making payments. Of these three types of user account status designations, this provides the least value to building your credit.
Joint User: If you have joint user status, you and the other user can both use the account, and you share equal legal responsibility. While this this type of user account designation can help build and improve your credit, it also links your credit history to another person’s financial behaviors.
Individual: If your account is designated as individual, you are solely responsible for the account, and only you can use the account. This type of user account status designation means that you qualified for that credit on your own and can have the most impact to build and improve your credit.
And if you’re renting, solutions like RentReporters can help build and improve your credit score by reporting your on time rent payments to TransUnion.
For more information on RentReporters, visit here.