How to remove an authorized user from a credit card account

If you’ve allowed a person to use your credit card as an authorized user, there may eventually come a time when you want to revoke their privileges. As the primary account holder, you are at your sole discretion to terminate the agreement for any reason and at any time. But while the credit card issuer is self-explanatory, it’s often a good idea to notify the person with access to your account first.

Here’s what makes a person an authorized user of your account, a few good reasons to remove a person from your credit card account, and how to do it correctly (and gracefully) with each of the major credit card issuers.

Authorized User Rights and Restrictions

All major credit card issuers allow primary account holders to designate additional cardholders. Authorized users do not need to go through the qualification process as they are never account holders. Instead, they are your invited guests.

The credit cards they receive have the same account numbers as yours but have their names printed on them. Users are legally allowed to transact and very often can report lost or stolen cards, view and discuss account information with the issuer, initiate billing disputes and make payments. Some may even be able to complete the balance transfer.

As the owner of the primary account, and depending on the issuer and card, you can set a lower limit for authorized users so that they do not have full access to your line of credit.

Most credit issuers provide account information on authorized users’ credit reports, and once listed, account activity will count towards that person’s credit score. As long as you manage your account well, making all payments on time and keeping your credit utilization rate low, an authorized user’s credit history and credit scores win.

However, authorized users are never required to pay the issuer. As the primary account holder, you are solely responsible for payments and debts, even if you did not make the payment. Therefore, it is important for you to always maintain control over your account.

First, make a set of rules. For example, you might expect an authorized user to:

• Reimburse all or part of your expenses
• Shop only at certain stores or buy certain things
• Do not charge more than a fixed amount each month
• Contact you before making a transaction to get your permission
• Use the card only in extreme cases

An authorized user must be aware of all expectations before agreeing to an arrangement, as well as the consequences of indecision. Write everything down and have all parties sign the agreement, said credit card expert Jason Steele. Clarity is an important component of an authorized user relationship, even if the person is very young.

“I was 14 when my parents made me an authorized user of their account, and I did it for my 13-year-old,” Steele said. “You have to make sure it’s a positive experience, and if it’s not, or no longer needed, end it.”

When to remove an authorized user from your account

While you do not need to offer a reason to your credit card issuer when you terminate your relationship with an authorized user, there are several reasonable reasons for doing so, including:

• Change in employment status: “Employers typically make employees authorized users on their business cards,” Steele said. “But if their work responsibilities or work travel needs to change or the person leaves the company, remove them from the map.”
• Divorce or separation: Couples who are breaking up should also pay attention to their cards, Steele said. If your partner is listed as an authorized user and you don’t trust that person to handle a credit card wisely, don’t delay accessing your account.
• Rules broken: If an authorized user does not comply with the agreement, you can disable it, especially if this has resulted in unmanageable payments or a large balance that you have to deal with.
• Regain control: When other people have access to your credit card account, you may experience a growing sense of anxiety about the possibility of debt or credit damage. In the end, you may decide that account sharing is not for you.
• Financial instability: You may have told the authorized user that you would cover the costs because you could afford it at the time. However, if your financial circumstances have changed and you are no longer able to pay for them, this arrangement may not make sense.
• Reduced line of credit: Credit card issuers have the right to reduce lines of credit, and if you do, your account may not have enough charge for additional cardholders.
• Account no longer in good standing: If you will be or are currently behind on payments, or your balance consistently exceeds 30% of your credit limit, the card does not provide any benefit to the authorized user’s (or yours) credit score, so you can withdraw the person as well.
• Credit history established: If you wanted to help a person build a credit history so they could qualify for their own card, and that goal was achieved, it might be time to move the person off your card. “Authorized users receive immediate profit when the card appears on the report,” said loan officer John Ulzheimer. “A well-managed credit card will help increase a person’s creditworthiness, even if they are not the primary cardholder.”
• Do not need anymore: Many parents let their young adult children jump on their cards to cover potential emergencies and learn how to use credit properly. So did Lisa Shamus, president of the branding company Lisa Shamus & Partners. “I wanted her to have it when she was in college and traveling overseas,” Sheamus said. “I deleted it when she graduated and got her first job. She has her own card and she pays her own bills.”

What if an authorized user wants to log out? This person may log out of your account at any time without your permission or knowledge by making a telephone request to the credit card issuer.

How to tell an authorized user that it’s over

While there is no law or policy requiring you to inform the person that you are removing them from your account, in many cases this is a good idea.

“If you have an authorized user who has abused privileges, you need to remove that person from your account,” said Beverly Harzog, a credit card expert. “Don’t scold the person, but explain why. This is an opportunity to tell someone about how credit works. And also discuss how irresponsible behavior with your credit card affects both of your credit scores.”

In the event that you remove a person from your card for a positive or neutral reason, or it is a personal decision that has nothing to do with him, simply explain your change of plans. Provide a date for when you will be taking this action so they can prepare, especially if they want to apply for a credit card or loan in their name.

When you tell your credit card issuer that you are removing an authorized user from your account, the issuer will typically submit a dispute form to three credit reporting agencies: TransUnion, Equifax, and Experian.

“Time is important,” Ulzheimer said. “Authorized users must apply for their own cards while the card is still on their credit reports. If you remove them from your account, the card will be removed from their credit reports, so any value it gave them will be lost.”

Conversely, if you think the person is going to take the opportunity to bill you a lot (as might be the case with an acrimonious breakup), an unplanned closure can protect you from unwanted debt.

Generally, credit card issuers do not notify people that they are no longer authorized users. This is up to you, the primary cardholder. Also, be sure to ask them to return the card to you or destroy it. If the person doesn’t and you think they will try to use it, contact the issuer to change the account numbers, which will render all old cards unusable.

How to remove an authorized user from your account

While you can usually add an authorized user to your account on the card issuer’s website, app, or phone, many issuers only remove authorized users over the phone.

Below are the customer support phone numbers of major credit card issuers, as well as those issuers that allow major cardholders to delete authorized users online.

bottom line

Worried about how removing an authorized user from your account might affect your credit reports and scores? Do not be.

“There will be no record of you removing this person from your card because they were never on your report,” Ulzheimer said. “So you don’t have to worry about any negative repercussions when you make changes.”

Once you have contacted the issuer with a request, returned or destroyed the user’s card (or changed account numbers), there is nothing left for you to do. You will have an account again.

Erica Sandberg is a well-known personal finance professional and author of Waiting for Money: The Essential Financial Plan for New and Growing Families. Her articles and insights have been featured in The Wall Street Journal, Pregnancy, Babytalk, Redbook, Bank Investment Consultant, Prosper.com, MSN Money and Dow Jones MarketWatch. An active television and radio commentator, Sandberg is a credit and money management expert at KRON-TV in San Francisco, and a frequent guest on Forbes Video Network, Fox Business News, Bloomberg TV and all Bay Area networks. Prior to starting her own reporting and advisory business, she worked at the San Francisco Consumer Credit Counseling Service, where she advised individuals, conducted educational seminars, and managed media relations. Sandberg is a member of the Society of American Business Editors and Writers and a member of the Project Money Advisory Committee.