What Is A Tradelines- All The Truth About Tradelines

Tradelines offer much of the data required to calculate your credit score and make up a substantial portion of your credit reports. This comprehensive guide will teach you all you need to know.  

A list of your credit accounts, known as tradelines, can be found on your credit report. Learning more about tradelines can help you undertake a more thorough analysis of your credit reports, which is crucial because it’s necessary to check your credit reports frequently to ensure everything is correct.

Tradeline definition

An account that appears on your credit report is known as a tradeline. Credit cards, mortgages, personal loans, and auto loans are just a few examples. The tradelines in your credit report are utilized to construct your credit score when a credit bureau requests it.

Tradeline on a credit report

Credit tradelines are accounts such as credit cards, vehicle loans, and mortgages that appear on your credit reports. They usually feature information such as the account’s opening date, current payment status, and whether you’ve paid on time or late.

Lenders use credit scores to determine whether or not you will be able to repay loans and pay your bills, and they are used to determine whether or not you will be granted credit and at what interest rate.

According to Michelle Lambright Black, credit expert, and publisher of, “if you borrow money and the lender reports that account to the credit bureaus, that constitutes” a tradeline. “Each of those data pieces can affect your credit score.”

Types of tradelines

A tradeline is a single account that appears on your credit report. Everything appears on the credit report, whether the payment is current or past due, and whether the account is open or canceled.

Here are the basic types of tradelines that you need to know:

Revolving account

Credit cards and other lines of credit are examples of revolving accounts. The credit and due payments on these accounts are referred to as revolving since they change as you make purchases.

Revolving tradeline accounts are pretty widespread and appear on every credit report. As a result, you must be cautious about using your credit cards and avoid late payments to avoid future problems.

Installment loans

Personal loans, student loans, and mortgages are all examples of installment loans. Installment accounts allow you to borrow a set amount from a lender and pay it back at a fixed rate.

If you open a lending account, it will appear on your credit record. If you do not repay the loan on time, your credit record will hurt.

Open accounts

Businesses, rather than individuals, are more likely to use open accounts. These accounts are due when a buyer receives products or something else of worth.

An open account has not been paid but is still available. Your credit score fluctuates a little bit whenever you create a new account. You may see a slight drop in your credit score, but everything will return to normal if you don’t do anything else to harm your credit score.

Why check your tradelines?

Checking your credit reports regularly is a good idea, and you can do so for free at It’s essential to take the time to double-check your credit reports for errors, as they could damage your credit score. You might also notice indicators of identity theft, allowing you the opportunity to take steps to mitigate the damage.

If you see any inaccuracies on the credit tradelines recorded, you can dispute them and request that they be corrected. The Federal Trade Commission provides sample dispute letters to get you to begin. If it’s not an account you opened, you can request that a tradeline be withdrawn. You can also correct inaccuracies in the tradelines, such as a payment recorded as late when you paid on time.

Information of a tradeline on a credit report

A credit account is a tradeline on a credit report. Credit agencies use these tradelines to create credit reports for individuals. The creditor reports the following information on each tradeline:

  • Creditor or lender’s name
  • Partial account number
  • Type of account
  • Date the account was opened
  • Date of last activity
  • Advertisement
  • Current balance
  • Credit limit or loan amount
  • Amount of the last payment
  • Date the account was last updated
  • Payment history
  • Current account status

Revolving and installment tradelines are the two types of tradelines. A revolving tradeline is a credit card account or a line of credit. The borrower can use credit as needed (up to their credit limit) for a more extended period with these accounts. An installment tradeline is a loan for a specific sum paid back in installments, such as a school loan, mortgage, or auto loan.

How do tradelines work?

Tradeline information from your credit report creates your credit score, a three-digit figure that measures your creditworthiness. Your tradelines will contain positive information. You’ll have a high credit score to show for your efforts if you’ve made your payments on time, kept your balances low, and overall been responsible with your credit commitments.

You can’t have a credit score without a tradeline. Your credit report must show at least one open and active tradeline in the last six months for the credit scoring computation to perform.

How tradelines affect your credit?

Your credit score is affected by the number of tradelines you have open at any given moment. Too many can make you appear overextended, while too few can indicate a lack of credit experience.

Unfortunately, credit scoring agencies haven’t revealed how many tradelines you’ll need to have good credit. To improve your credit score, you should only open and terminate accounts as required, maintain good credit on your existing accounts, and keep your loan levels low.

While having good credit has its advantages, it does not guarantee that your applications will be granted. If you’ve lately applied for many lines of credit, for example, your credit card application may be declined.

Some credit card companies additionally report to the credit bureaus the nature of your relationship with the principal account holder. When you apply for credit, lenders may take this relationship into account.

Purchasing tradelines isn’t always a good idea. Lenders and credit reporting agencies see this as dishonest. Therefore they’ve changed the scoring model to decrease the influence of acquired tradelines.

When are tradelines removed?

Any information that is correct, comprehensive, and within the credit reporting time limit is allowed to be reported to credit bureaus, including any bad or overdue accounts you may have.

Your credit report will show open tradelines with favorable information indefinitely. Closed tradelines with positive information will appear on your credit record for a time set by the internal reporting requirements of each credit bureau. Close tradelines with bad information such as delinquencies or bankruptcies will be removed from your credit record within seven to ten years.

Positive closed tradelines, for example, are kept on your credit history for up to ten years by Experian, whereas bad closed accounts are erased after seven years.

Can you buy new tradelines?

Any information that is correct, comprehensive, and within the credit reporting time limit is allowed to be reported to credit bureaus, including any bad or overdue accounts you may have.

Your credit report will show open tradelines with favorable information indefinitely. Closed tradelines with positive information will appear on your credit record for a time set by the internal reporting requirements of each credit bureau. Close tradelines with bad information such as delinquencies or bankruptcies will be removed from your credit record within seven to ten years.

When you’re added to a purchased tradeline, usually as an authorized user on someone’s credit card, the account stays on your credit report for a long time, which helps to raise your credit score. You can then apply for credit on your own once your score has improved.

How tradelines affect your credit score?

A lender will ask for your credit score as part of the approval process when you apply for credit. The credit score algorithm uses your tradelines to calculate your three-digit credit score.

Here are the five factors that make up your FICO score, along with the weight given to each element:

  • Payment history: 35%.
  • Amounts owed: 30%.
  • Length of credit history: 15%.
  • New credit: 10%.
  • Credit mix: 10%.

Your credit score may be affected if one of these criteria changes due to your credit activity. Here’s an illustration: Assume you’ve decided to close a credit card account. It has no immediate effect on your credit history, but it does result in the loss of available credit for the secured card. This raises your credit utilization ratio, which is the difference between how much credit you’ve used and how much credit you have available. A more than 30% debt-to-income ratio will almost certainly reduce your credit score.

When are tradelines removed?

A tradeline may be erased from your credit report for various reasons. When you close a credit card account, the tradeline for that account does not automatically disappear from your credit report. A closed account that has a beneficial impact on your credit score can stay on your report for ten years.

After two months, if you were an authorized user and were removed from an account, the tradeline will be removed from your credit report.

If you believe you have been the victim of fraud, you can also request that a tradeline be withdrawn. Because a bogus account frequently has negative data attached, removing it will help you improve your credit score.

Negative tradelines, such as a credit card account in collections or bankruptcy, will appear on your credit report for seven to ten years. Fortunately, after the first two years, the bad influence on your credit score begins to diminish.

Do your homework if you’re still considering buying a tradeline as a final option. Customers may be duped by companies that sell tradelines. The advantages of purchasing tradelines are fleeting and uncertain.

Rather than paying hundreds of dollars for a tradeline through a company, you can ask a cousin or acquaintance to add you as an authorized user on one of their accounts. That would have a greater chance of improving your credit score, and it would cost you nothing.

A brief definition of tradelines vs. the industry

If you don’t grasp the difference between tradelines and the tradelines business, it can be not easy when discussing the legality of tradelines. How are these two things so dissimilar? What you should know is as follows.

Accounts that appear on your credit report are known as tradelines. These accounts reveal that you have access to credit and how you manage it. Do you, for example, make your minimum payments on time? Do you have a credit utilization ratio that is acceptable? How much have lenders entrusted you with in terms of loans or credit limits?

These are always legal accounts. They are, in fact, a requirement for establishing or repairing credit.

The tradelines industry is a business that allows people to share, exchange, buy, or sell account ownership. This is usually done with authorized users when done appropriately. When someone is trying to enhance their credit, they can add their name to an existing account to help their score.

However, some tradelines tactics can be highly deceptive, if not outright fraudulent. The answer to the question “are tradelines illegal?” is yes in this situation. It is, nevertheless, prohibited to join in a fraudulent purchase scheme.

However, not all tradelines businesses are deceptive. So, how do you get involved in the industry?

Authorized users or “piggybacking credit”

Piggybacking credit is another term for being an approved user. This is because an authorized user enjoys all of the benefits of having a good tradeline without contributing to the account’s good standing.

An authorized user can use a Tradeline Supply Company to join a good account without needing to:

  1. Have good credit that’s necessary to open the account, or
  2. Make payments on the account.

It’s worth noting that authorized users don’t have access to a line of credit added through a supply firm. As a result of their report and score, they only gain advantages.

According to the Federal Reserve, piggybacking as an authorized user can increase people’s credit scores to a moderate to a high level. According to their findings, those with less credit history can experience a significant boost in their credit scores. On the other hand, people with bad credit can benefit from a slight rise per tradeline.

This may appear too good to be accurate, but believe me when I say it is. Not only is piggybacking legal, but it’s also quite popular. Being an authorized user is the initial credit history for one out of four Americans. This is because parents frequently join their children in their credit accounts to assist them in establishing credit.

Adding yourself as an authorized user on an account in good standing is a legal and ethical way to increase your credit score. A customer pays a supply firm to be added, and then the account’s principal owner receives a commission.

Making credit accessible to all

Some children have easy access to credit-worthy individuals. They can swiftly add their offspring to their trade lines if their parents’ trade lines are in good standing. Their adolescent is suddenly amassing credit without even trying.

While this is excellent for those youngsters, it is essential to remember that not everyone is that fortunate. One-third of Americans have fair or poor credit and could not provide their children with a good credit history even if they wanted to. Isn’t it true that people who don’t have easy access to credit should be unable to build good credit?

It can be tough to establish if you don’t already have credit. Selling tradelines is an excellent way to level the playing field for everyone in this situation. You can start building your credit by merely gaining permission to work as an authorized user.

Bad practices do exist within the tradeline industry

While it has not been shown that purchasing and selling tradelines is illegal, we are not suggesting that all tradeline companies operate lawfully or ethically. Unfortunately, the tradeline sector employs several unlawful and unethical practices that consumers should be aware of.

For example, scammers in the tradeline and credit repair businesses are increasingly selling customers “credit profile numbers” or “credit privacy numbers,” sometimes known as CPNs. These con artists claim that if you have bad credit and need a “clean slate,” you may buy a CPN and use it instead of your SSN to apply for credit, but this is a deadly lie.

Identity theft and synthetic identity fraud are common uses of CPNs, and falsifying your Social Security number is a federal offense. Your tradeline organization must implement rigorous fraud-prevention and legal compliance measures.

“Address merging” is another very prevalent yet unlawful approach. The tradeline corporation uses this strategy to get the authorized user to falsely state that their address is the same as the primary users to increase the chances of the tradeline posting.

The organization would even use the fictitious address to get the client’s credit record in some situations. It’s not a good indicator if a corporation can only get tradelines to post by asking customers to commit address fraud.

Unethical tradeline exchanges

The answer to the question “are tradelines legal” is yes as long as you use reputable tradeline companies to become an approved user. Other options for acquiring complete or partial control of these accounts exist.

Many scammers claim to be able to improve your credit quickly and will use a variety of sales presentations to persuade you that this type of purchase is lawful.

Here are the red flags to know when are tradelines illegal:

  • Companies may claim that obtaining a Credit Privacy Number allows you to conceal a poor credit history or bankruptcy. In truth, they are frequently the Social Security numbers of someone else, and the “business” is accusing you of identity theft.
  • Purchasing a defaulted account. This will make you the primary owner of an account currently in default mode. This could be detrimental to your credit and a waste of money.
  • Address the issue of merging. A corporation may require this for you to join an account as an authorized user. However, this is deception, indicating that this is a shady business.

Always be cautious and only engage with reputable supply businesses to guarantee that you purchase only lawful tradelines.


Are tradelines legal or illegal?

Fair Isaac Corporation, for example, reported in 2008 that users were “abusing” the authorized user system. Congress, on the other hand, was not convinced. They claimed that denying authorized users were discriminatory under the Equal Credit Opportunity Act.

This judgment strengthened the idea that persons might become authorized users on existing credit accounts. That tradeline would damage their credit score if they used their name on another account. An authorized user can profit from a good account with on-time payments, no defaults, and a long history.

This made the chance available to everyone the account holder approves, not just friends and relatives. It is lawful if an account holder agrees to have an authorized user.

This means that supply firms might act as a link between those looking to enhance their credit and others who already have good credit and want to profit from it. As a result, the answer to the question “are tradelines legal?” has become a loud yes!

While tradelines are lawful, how and with whom you conduct business is also a factor. This is because there are illegal tradelines that sell frauds through shady companies.

However, as long as you work with a reputable, trustworthy supply company as an authorized user, you can rest confident that this is a valuable legal technique for improving your credit.

How is buying tradelines different from becoming a traditional authorized user?

In a standard authorized-user scenario, a family member—someone you know and trust—adds you to their credit card account. You won’t have to pay the primary account holder, and you’ll likely obtain a card connected to the account that you may use to build good credit habits (with the principal cardholder’s consent).

Because you won’t be able to use the card for purchases, buying tradelines won’t help you create healthy credit habits. Furthermore, if you send your sensitive information to strangers, you risk identity theft. Finally, buying tradelines exposes you to risks that you may avoid by improving your credit in other ways.

The bottom line

The FTC’s remarks during a congressional hearing in 2008 and FICO’s subsequent retreat from its attempt to eliminate authorized user privileges were necessary confirmations that the tradeline business is here to remain.

Parents will still be able to add their children to their credit cards to assist them in getting a good start in life, and those who aren’t so wealthy will still be able to find equal possibilities in the marketplace.

While the tradeline sector is undoubtedly divisive, it points to deeper concerns with the credit system. Some say that credit bureaus are obsolete or malfunctioning systems. Credit scoring models are far from flawless.

On the other hand, many people appear to forget that credit bureaus are for-profit businesses that exist to make money. So, before delving into the ethics of tradelines, we need to consider who built the system in the first place and who it serves.

Was the system designed with justice and equality in mind? Is there an equitable opportunity for everyone in the system?