Ask Liz Weston

Dear Liz: I am a divorced 49-year-old man who has a lot of debt. I recently (and shamefully) turned in the keys on my ridiculously upside-down home in Arizona. My credit scores have plummeted and all my credit cards have raised their rates to 28% and above.

I am remarried to a wonderful woman who is more fiscally responsible and wants to buy a home. I’d like a quick fix, but that seems unlikely. I’ve avoided commingling our assets and credit so far, but recently I asked my wife to cosign a personal loan to consolidate my debt. I’ve also requested to be an authorized user on some of her high-limit, low-balance credit cards.

I fear this may be a break point for our relationship. She has worked hard to be responsible and I — well, I have not. My strategy seems sound. What do you think?

Answer: Your plan could dramatically lower your interest costs, allowing you to repay your debt more quickly. It also could help rehabilitate your battered credit scores.

But the cosigned loan would put your new wife’s credit in your hands. If you missed a single payment, her hard-won credit scores could plunge overnight. If you failed to pay the debt, she would be responsible for it.

That’s a huge risk for her to take, so you shouldn’t hold it against her if she declines. Adding you as an authorized user of her cards involves much less risk, since she wouldn’t have to actually give you access to those cards, but she’s under no obligation to do that either.

If she turns you down, you might want to consider a visit with a legitimate credit counselor (one affiliated with the National Foundation for Credit Counseling) as well as a session with a bankruptcy attorney so you can be apprised of all your options regarding your debt.

Dear Liz: My credit scores are good (over 800 when I refinanced my mortgage last year). I was thinking of listing my son, who is 14, as an authorized user of my credit cards to start establishing his credit history. Will it work? Is there any other way to help him? If it is too early, when is a good time to start?

Answer: As long as you handle your credit cards responsibly — using 30% or less of your credit limits and paying on time — adding your son as an authorized user could indeed help him build his credit history.

This is important, because under the credit card reform law that goes into effect in February, people younger than 21 will have a much harder time getting credit cards and thus building credit on their own. Yet they will need good scores to get apartments, good insurance rates and decent loan rates when they leave the nest.

Adding a child as an authorized user to a card is a low-risk way to build his credit since you don’t have to give him the card or access to the account. Instead, your history with the card is simply added to his credit reports, assuming your credit card issuer agrees (call and make sure first; some issuers report authorized-user information only for spouses). All versions of the leading FICO credit scoring formula factor authorized-user information into their scores, although the latest iteration — FICO 08 — limits how many authorized-user accounts are included.

When you decide to do this is up to you. A longer credit history is generally better, but you should add him only when and if you’re comfortable doing so.

If you decide to do this, discuss with your son the reasons why and also take the opportunity to talk about responsible use of credit. Make sure he knows the importance of paying all balances in full every month and how carrying credit card debt is foolish and expensive. He may not be using the card now, but he’ll have his own credit soon enough, and it’s never too early to instill the importance of using cards as a convenience rather than a crutch.

Dear Liz: My fiance and I are trying to secure financing for our first home, but his credit scores are just below the mark. I was thinking of adding his name to my credit card account so that my available credit line shows up on his report. Would this boost his scores at all? Is there any danger of it lowering his scores?

Answer: If you have a good history with this account — you always pay on time and you’re not carrying a large balance — adding him as an authorized user may help his scores.

The key is whether the credit card issuer will “export” this data from your credit file to his. Some issuers automatically do this export for any authorized user; others do so only for spouses. The only way to know for sure is to ask your credit card company.

If the data is exported to his file, it will be used to calculate his FICO scores, which are the scores most lenders use. The company that creates the FICO briefly toyed with the idea of excluding authorized user data in its latest formula, FICO 08, but ultimately decided to continue using it.

If you add him as an authorized user, you don’t need to give him a card or access to your account. What you should do, however, is take some time to go over his credit reports and discuss what steps he’s taking on his own to clean up his financial act.

A temporary boost in his scores might land you a mortgage, but you could wind up much worse off financially if he continues to mishandle his credit.