These tradelines will boost your credit! Why pay hundreds of dollars for tradelines when you don’t have to?
|CreditStrong||Credit builder account||$1,000||In stock||$15/mo.||More Info|
|Extra||Debit card that builds credit||Varies||In stock||$8/mo.||More Info|
|BoomPay||Rental tradeline||Varies||In stock||$25||More Info|
|Indigo||Credit card||$300||In stock||$99||More Info|
|Grow Credit||Revolving account||$204||In stock||$41||More Info|
|Self||Credit builder account||$1,000||In stock||$25/mo.||More Info|
|Experian Boost||Utility tradeline||Varies||In stock||$0||More Info|
Why These Tradelines are Better than Authorized User Tradelines
All of the options we list above are accounts in your name and will be considered primary tradelines.
When trying to build credit, primary tradelines are much better for consistent long-term credit score growth.
An authorized user tradeline may give your credit score a boost, but it will be a smaller credit score increase than what you would see if you had that same credit card account opened in your name as the primary account holder.
Buying tradelines like the ones we listed above are a whole lot cheaper than the $1000+ price tag that comes with purchasing seasoned authorized user tradelines.
Some of the options we presented are accounts you can open for free, while most come with a small associated fee or low-level interest charges.
And all of these accounts and services are 100% legal, whereas the authorized user tradeline market operates in a gray area that walks the line between legal and fraudulent.
So if you are in need of credit repair, or are just working at improving your bad credit score, instead of buying tradelines like the authorized user slots many tradeline companies offer, consider opening a credit account in your name.
This way, all of the beneficial account info added to your credit reports, like the credit limit, payment history, and credit utilization, can have the maximum impact on your credit score.
How Do Tradelines Work?
A tradeline is any account that appears on one or more of your credit reports.
This usually includes installment accounts (loans) and revolving accounts (credit cards). But it can also include other types of accounts, like rent history and utility payments.
These tradelines are the building blocks for your credit score calculation.
Each tradeline on your credit report contains essential account data, including a record of your payments, balance history, the date you opened the account, and more. Each of these factors is weighed as a part of your credit score.
For instance, payments are reflected in the payment history portion of your credit score, and the date you opened the account will be factored into the length of credit history part of your credit score.
When buying tradelines or adding a tradeline to your credit reports, it will impact each of the different credit score factors as the new information appears on your credit reports.
For instance, an account with a newer account opening date may decrease your overall length of credit history. Or, an account with a high credit limit may improve your overall credit utilization.
Why Authorized User Tradelines are Shady
The buying and selling of authorized user tradelines occur in a gray area of the credit world. While the practice is not technically illegal, it is often viewed as fraud.
If you are selling tradelines, and your credit card company finds out, they could drop you as a customer.
Buying tradelines like this is often very expensive, and it is unclear how much of the money changing hands goes to the cardholder versus how much remains in the broker’s pocket.
In addition to being expensive, these authorized user tradelines are temporary, often reporting activity for two months or less before being closed out. And, they might not even report to all three credit bureaus.
FICO has caught on to this practice and has actually adjusted its scoring models to ignore these potentially fraudulent authorized user accounts, omitting them from credit score calculations.
Because of the limited reporting window and FICO’s crackdown, buying tradelines in this way might not even impact your credit score.
And the worst part is that this market is a gray area; you have little to no recourse for getting back your money if you are unsatisfied with the service.
Is It Legal to Buy Tradelines?
Buying and selling tradelines is not technically illegal, but it can be considered fraud because it violates most credit card companies’ terms of service.
It is perfectly legal to add your spouse, family member, or even close friend as an authorized user on your credit card account, but the minute money begins to exchange hands, this is what is considered fraud.
There are even rumors of upcoming legislation to ban the practice of buying and selling authorized user tradelines.
Buying tradelines, or rather, opening tradelines, is legal when it comes to primary accounts.
We say ‘buy’ here because many credit building types of accounts, like credit builder loans or secured credit cards, require you to put up a security deposit, pay a subscription/admin fee, or pay an annual fee.
So, instead of buying tradelines from a broker or individual, you are, in a sense, buying tradelines from a lender or creditor.
How Much Will a Tradeline Boost My Credit?
This will largely depend on your current credit report and score and what kind of tradeline you are adding. But, generally speaking, you can see an increase ranging from 20 points to 100 points or more.
If, for example, you are starting with zero credit and adding a rental history tradeline with two years of payment history, this will likely boost your score significantly when using a FICO 9 scoring model or newer.
Whereas using a service like Experian Boost when you already have several years’ worth of credit history might only raise your score a few points, if any.
And in some cases, opening a new tradeline may actually decrease your score, though this will only be temporary. As you maintain on-time payments and keep your account in good standing, then your credit score will begin to increase once more.
An authorized user tradeline, on the other hand, may end up having no impact on your credit score at all. This method of achieving a good credit score is best for those with no credit history. Those with bad credit won’t benefit as much from being added as an authorized user.
How Much Does it Cost to Buy a Tradeline?
Again, this depends on what kind of tradeline you are adding.
Authorized user tradelines range in prices based on the age of account and credit limit. Younger accounts will cost in the neighborhood of $200, while seasoned tradelines will cost you in excess of $1000.
Alternatively, adding utility tradelines can be done for free using Experian Boost. Or you can pay a 3rd party company a small fee, usually between $2 – $10 a month, to add a rental tradeline to your credit reports.
Opening a new revolving tradeline can range in cost from free to several hundred dollars if you are required to put up a security deposit.
Or you can open an alternative type of account that works like a debit card and reports like a credit card, like Extra, which charges a small monthly fee for credit reporting.
What Are Primary Tradelines?
A primary tradeline is an account where you are the primary account holder.
For instance, if you open a credit card in your name, this is considered a primary tradeline when it reports to the credit bureaus.
If you were to then add your spouse as an authorized user to this credit card account, it would be viewed as an authorized user account on your spouse’s credit reports.
It is important to note that joint accounts and cosigned accounts are also considered primary tradelines on your credit reports.
Primary tradelines can consist of credit cards, student loans, auto loans, rental history, utility payments, a mortgage, and more.
Basically, any type of account that is reported to the credit bureaus, where you are considered the primary account holder, is a primary tradeline.
Will Buying Business Tradelines Improve Business Credit?
Buying tradelines is not the best way to build business credit. This is because business credit scores work much differently than personal credit scores.
Duns & Bradstreet is a credit reporting agency unique to business credit. And the score ranges and calculations used for business credit scores vary widely between them and the other business credit reporting agencies.
There are some similarities in calculating credit scores between scoring models. For instance, keeping your credit utilization low will result in good credit, while multiple late payments will equal lousy credit.
But when it comes to credit repair, purchasing tradelines might not have as big an impact. For example, traditional credit card revolving tradelines are not as crucial to business credit. Instead, business loans and vendor accounts are much more critical.
So having an authorized user credit line reporting to the business credit bureaus likely won’t make much of a dent in your credit scores.
When it comes to business credit repair, you can buy credit tradelines. Just don’t expect excellent credit to come from it.
Read the other articles in our tradeline series: