You should always make sure you know whose credit file will be checked when applying for any type of financial product with another person. Failing to take account of how another person's position could affect your application for credit could result in your request for a card being turned down or you having to pay more for what you borrow.
Any second or additional cardholder you add to a credit card account will not be credit-checked. An additional cardholder can charge to your account and pay down its balance but typically won't be able to make changes to it, according to Wells Fargo. You can usually add an additional cardholder to an account when making an application for credit or once your account is up and running.
Consumers with bad credit can ask friends and relatives with good financial track records to co-sign card applications if they're having trouble borrowing money. Both signatories to a co-signed account will have their credit run before a lender decides whether to approve an application. The high credit score of a co-signer can help someone with bad credit get access to cheaper money.
You will be solely responsible for repaying any balance run up by a second cardholder on your credit card account. The way your account is managed will have absolutely no bearing on the credit record of the additional cardholder. If your second cardholder runs up a huge balance on your account and finds she is unable to pay the money back, your credit score will suffer if any payments are missed. You will be jointly responsible for any account you agree to co-sign. If the person you've agreed to co-sign for goes on a spending spree with her card and then defaults, you will be liable to pay the money back and your credit score will take a hit.
You should only authorize an additional cardholder on your account or co-sign somebody else's credit card application if you're confident the person you're linking yourself to financially won't let you down. You will be responsible for the spending behavior of a third party in both scenarios and could risk damaging your credit score considerably if things don't go according to plan.
Michael Roennevig has been a journalist since 2003. He has written on politics, the arts, travel and society for publications such as "The Big Issue" and "Which?" Roennevig holds a Bachelor of Arts in journalism from the Surrey Institute and a postgraduate diploma from the National Council for the Training of Journalists at City College, Brighton.