An authorized user is someone authorized by the original credit holder to use the holder's account.

The credit holder is responsible for the charges on the account, but the authorized user is not responsible for paying any charges, including his own.

Authorized user accounts have been a favorite trick of mortgage brokers. If a potential client doesn't have a high enough credit score, they will often advise the client to have some one with good credit add them to an established account as an authorized user. Once the new account appears on their credit report (usually within a few weeks), their credit score can increase. In the event of someone with no score or a very low score, the increase could be significant. Obviously with a better credit score they are a better loan candidate.

A case could be made for this use of authorized users as fraud. Sure, it's not as bad as the credit repair companies that sell piggybacking services for thousands of dollars, but it is still a misrepresentation of the client's real credit data. I'm sure there are some borrowers who got artificially low rates or loan deals based on this instant credit fix.

Being an authorized user on someone else's credit card account certainly has its perks. But it has its problems too. There's a pretty serious credit catch that most people don't know about.

Even though you never applied for the card and you're not responsible for the card's payment, the card account and its payment history may still be recorded on your credit report. Once there, the account will carry just as much weight as a card account opened in your own name.

Being an authorized user on a well-managed account with a long payment history could boost your credit rating. But if the account goes unpaid, your credit score could take some serious hits.

Some lenders will even slap bankruptcy information for an account on the credit report of an authorized user

Check your credit report to make sure you aren't the authorized user on someone else's account. If you are an authorized user, an "A" notation will appear on your credit report in the left hand column.

If you are going through a divorce, insist that your ex-spouse remove you as an authorized user from any credit cards as part of the settlement agreement.

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