Many young couples use credit cards to pay for bills or incidental purchases to develop their credit history. Over time, a history of on-time payments increases their credit score, making them more likely to receive credit or a mortgage in the future. That's why, after the vows, one spouse may want to add the other spouse as an authorized signer.
Authorized Signer
An authorized signer, or authorized user, gets a credit card with her name on it. She has the right to use the credit card for any purchases and may sign for those purchases to your account. This option works well for young couples who already have credit cards, and one spouse wants to give the other access to the credit account. It also works well for parents who want to give a card to a child.
Co-Signer
A co-signer uses their credit history and income to help you get approval on your credit card. They do not receive a credit card or have authorization to make purchases on the credit account. When one spouse receives a denial on a credit card, using the other spouse as a co-signer may get the credit card approved.
Add to Account
A credit card holder may add an authorized signer at any time. The cardholder must simply contact their credit card company and request the card be issued to the authorized signer. The credit card company does not pull the credit report for the authorized signer. A co-signer is involved in the application process from the beginning. Their credit report is pulled in order to approve the account.
Liability
An authorized signer does not have any liability to pay back the credit card debt. They did not sign for the credit card contract and did not agree to pay back the debt. A co-signer agrees to pay back the debt if the cardholder defaults on the contract. The co-signer may be pursued using collection efforts or sued in civil court for the balance of the credit card account. Marriage complicates things a little bit. As an authorized user on your spouse's account that was opened prior to your marriage, you are not liable to pay it back. If your spouse adds you as an authorized user on a new account opened after the vows, you have some liability in paying back the debt.
Considerations
Part of the benefit of being added as an authorized user is getting the good payment history on your credit report. You are not responsible for paying the card, but most credit card issuers still report the account on the authorized user's credit report. Should the card go into default, that information reflects on your personal credit report, lowering your credit score. You may be able to get that black mark removed using the dispute process, but it may take a lot of back and forth with the credit reporting agency.
