What are tradelines on your credit report?

The saying “too much of a good thing” applies to tradelines. Tradelines are all over the place. If you ask 100 different people what trade lines are, you might get 100 different answers. The purpose of this blog post is to explain what tradelines are, generally and specifically.

Tradelines are accounts.

Everyone agrees to the basics. Trade lines are the accounts that appear in your credit report. For example, such as credit cards, mortgages, car loans, etc. That’s the basic mortgage term and jargon. But, if you’re on this website, you probably think trade lines have something to do with repairing your credit or increasing your credit score. Both definitions are correct.

As far as increasing your credit score by using tradelines, this is referred to as “piggybacking credit.” This is accomplished by one person being added as an authorized user to another person’s credit card. The first person does not have any expending ability on the second person’s credit card. They are listed as an authorized user in name only. The purpose is not to give the first person and ability to charge up debt on the credit card. Rather, the purpose is to allow the information associated with the credit card to report to that person’s credit report. When that information reports, assuming that the credit card is in good standing, that person’s credit score will increase. It’s as if the person established their own credit card years ago and paid on time.

The practice of credit score renting has emerged.

Because the foregoing process is easily accomplished, but, because the foregoing process requires the knowledge skill and ability to connect the appropriate people, the practice of piggybacking credit as a business model emerged.

This business model allows two strangers to connect in a mutually beneficial relationship. The first person receives a credit score increased by being added as an authorized user. The second person receives financial compensation for helping the first person. You’re probably thinking this sounds like one person co-signing for another and you’re right… it sounds like that. However, it’s much different. The authorized user has no spending ability on the primary account holders account. That is unless the primary account holder gave the authorized user an authorized user card, which is never done.

Both definitions are important.

You can correct your current tradelines (i.e., correcting the current accounts in your credit report) to improve your credit score. You can also pay to be added as an authorized user to seasoned tradelines (or pre-existing tradelines). Both are important and both improve your credit score, assuming both are done correctly. “Corrections” usually fall into the “credit repair” category of credit score improvement. Whereas, “tradelines” usually falls into the “credit enhancement” category of credit score improvement. We can help with both!

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