Primary Account Holder – Understanding Primary Account Holders

What is a Primary Account Holder?

A primary account holder is the initial or main user of a credit card account. The primary account holder, accounts for the debt, for paying account balances, and also can make changes to the account. Secondary users that are listed on the account, thus can’t pay account balances.

Understanding Primary Account Holders

The person who is seen as the primary account holder is the person who makes the initial move to open an account or to apply for credit. It is the primary account holder’s profile that the financial houses use to approve the account.

The primary account holder may allow users to gain access to the account with most money accounts. Authorized users are also known as additional cardholders. However, with authorized users, the primary account holder is still held for all charges on the account, plus charges made by both the primary account holder as well as any additional users on the account.

Primary account holder processes vary across various types of accounts. But the two main accounts set up by an individual primary account holder includes checking accounts and credit card accounts.

Types of Primary Account Holder Accounts

Checking Accounts

This requires a less firm background check for approval than that of a credit card account. However, these accounts will still request a variety of personal details from the primary account holder for approval including their full name, address, and social security number (SSN).

After a primary cardholder has been approved for a checking account, a debit card and checks are issued. The debit card can be used for funding. Primary account holders have the option of adding an authorized user which offers a card for each user.

Credit Cards

The primary account holder can apply for a credit card. When this happens, the issuer will consider the primary account holder’s credit score. When deciding whether or not to extend credit. Additionally, the primary account holder may request that the credit card company issue cards to authorized users.

In some cases, the issuer may have no business pursuing authorized users for any unpaid balances. Rather, the primary account holder is the one to request a credit limit increase, redeem cashback or reward points, and close the account.

Primary Account Holders vs. Joint Account Holders

Some money houses are known to offer joint accounts to their customers. These accounts, give two access to be seen as primary account holders. Married couples or family members like parents and a child commonly engage in opening a joint account. Here, each account holder can be held for the charges made on the account. And not just for the portion he or she personally charged to the account with his or her name on it.

Either of the individuals is also at liberty. to add users to the account. Both joint account holders share equally the charges made by each other and any authorized users.

Difference Between Primary & Secondary Account Holder

Secondary account holders are also called authorized account holders. They are those who may have access to certain parts or all of an account as outlined by the primary account holder like signing authority. A typical example is where a secondary holder may be able to make deposits to a business account, but may not be able to make withdrawals from that account.

Most times, a secondary account holder may have no legal duties for the account. What this implies is that the institution cannot go after the secondary account holder in the event of any fraud or problems. This means that the primary account holder must assume responsibility for all the other users does including the balance. Thus, the account owner is liable for any cashout a secondary accountholder makes.

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