Buying Tradelines: Can They Help Improve Your Credit Score?

Learn why tradelines are important to borrowers and lenders.

Simply put, tradelines are credit accounts listed on your credit report. Each of your accounts is listed separately on your credit report, which provides information about the specific debts and creditors. Knowing how to read tradelines is crucial, as it can help you better understand your credit score, how to improve it and identify what lenders see on your credit report.

Here’s a brief guide to understanding tradelines and how they affect your credit score:

What Are Tradelines?

Tradelines show lenders how you have handled different types of credit in the past. There is a tradeline for every credit account under your name. This may include revolving tradelines, which often involve debt associated with credit cards or lines of credit. There are also installment tradelines, which include various loans with fixed payments. The tradeline will include information about each debt, such as the lender’s name, type of account, debt status, activity and your current balance.

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All of these factors will help calculate your credit score, and lenders can check your tradelines to get more information about your creditworthiness. Without this information, it would be difficult to construct a credit score model and create trust between the lender and consumer.

Your credit score tells lenders how trustworthy you are, which means it’s important to keep it as high as possible. Lenders will look up your credit score when you take out a loan, open a credit card or make a large purchase, like a car or a home. Having a low credit score can affect your eligibility for these loans and purchases, so your tradelines can either help or hurt your credit score. When you have a low credit score, it may be worth considering buying tradelines.

Related: What Is the Highest Credit Score?

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Buying Tradelines

There are various third-party services that charge a fee to add you as an authorized user on a credit account. When you become an authorized user on an open account, this item will show up as a tradeline on your credit report. Buying tradelines is often used to quickly increase credit scores just enough to gain approval for a specific loan or line of credit.

While the tradeline will only be on your account for a short period of time, this process often costs thousands of dollars — which may not be worth the price. Buying tradelines is expensive and tricky, as you often don’t know the person adding you as an authorized user. Buying tradelines can also be considered deceitful because you are misleading a lender or bank about your trustworthiness. It could be seen as committing bank fraud, which is against the law.

If you want a less risky way to build credit, you can ask a family member to add you as an authorized user on their credit account. If your family member has an excellent credit score and payment history, it will certainly help to have this tradeline on your credit report. It’s important to be an authorized user on the account of someone you trust — and you won’t have to pay an exorbitant fee to build credit.

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Can Tradelines Help Boost Your Credit Score?

Tradelines can certainly help improve your credit score. One of the most important factors in building credit is the length of time that the tradeline is on your credit report. When the tradeline shows perfect payment history, your creditworthiness increases. So, becoming an authorized user on a trusted account can help boost your own credit if this person has a great credit history.

Though the average tradeline lasts about six months to one year, tradelines can stay on your credit report for significant amounts of time — even years. Your credit score will be the most affected by recent debt and the items reported.

Other than focusing on your tradelines, there are other ways to raise your credit score quickly. If you’re prone to late payments, setting up reminders will help you pay your bill on time and avoid hits to your credit score. Additionally, try paying down your credit card debt or overpay beyond the monthly bill if possible. It’s also important to review your credit report periodically. The three credit reporting agencies — Experian, TransUnion and Equifax — will provide a free copy of your credit report every year. Reviewing it can help you determine problem areas and any disputes that need correcting.

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