Tradelines- Should I buy them? You need to watch this now!
Your Credit Minute Show Notes:
- 00:00 Hey You Tubers! This is Nik Tsoukales, with Credit News Daily.
- 00:03 Let’s talk about tradelines. Let’s talk about buying tradelines. I’m getting this question a lot, “Should I buy tradelines, I got a company, they emailed me randomly and they sell tradelines. I can get tradelines and have instant, amazing credit. Should I do it?”
- 00:22 Um, short answer is, no. A-T- double hockey sticks, no. You should never, ever, ever, ever, ever, in a million years, ever buy tradelines.
- 00:33 Number one, um, for those who don’t know what a tradeline is, it’s an account. Okay? Tradeline is a line item on your credit report, okay? And there are some strange, weird, shady companies out there that will sell you the ability to become an authorized user on other people’s accounts, okay?
- 00:52 If you’re unsure what that is or you’re wondering what that is, let’s say me, Nik, I want to make you a cardholder on one of my credit card, uh, on one of my credit cards, okay? I can make you a cardholder, or something called an authorized user, okay? And even though you don’t necessarily qualify for that credit card, it will start reporting to the three credit agencies the date of the positive reporting, um, on-on your credit. Okay, you’ll actually get the credit from that credit, okay? Um, you’ve never qualified for it though, I’ve just added you.
- 01:21 Now, there are some companies online right now, that are willing to sell you someone else’s tradeline. They’ll charge you a thousand, two thousand, three thousand dollars, and what you’ll do is you’ll become an authorized user on some random people’s credit card.
- 01:35 Number one, don’t do this. And the reason you don’t want to do this, or there are quite a few reasons, the first is, it’s pretty highly illegal. The Federal Trade Commission is really frowning, uh, uh, upon this, okay? They don’t like this practice. The companies that are selling this stuff, most of them have been sent cease and desist letters. There have been some companies where the owners have actually gone to jail for selling these tradelines. It’s highly illegal, okay? The CFPB, the Consumer Financial Protection Bureau, is frowning upon this, okay? So they’re saying no also.
- 02:11 Keep in mind, um, it’s not totally black and white, but the perc-, the perception of it is that you’re actually using someone else’s identity as well, okay? For the purposes of, basically ripping off future banks and lenders. It’s a shady practice, so you want to stay away from it.
- 02:27 Another big reason, let’s say it wasn’t. Let’s say it was perfectly legal and perfectly fine. Another thing is, you’re not in control of your own credit. Guys, we teach you how to manage your credit cards, how to manage your debt, how to manage your on time payments, how to build a payment history, how to access different types of credit, the FICO five, I show you guys how to control the five factors that make up your FICO score.
- 02:49 Well, when you sign up as an authorized cardholder on some random person’s card, you don’t control your credit anymore. If they go late on that card, you go late. If they max out that card, you’ve maxed out that card as well. Okay, so you are no longer in control of your credit report. And that alone should scare you to death.
- 03:08 So, I would absolutely stay away from tradelines. Number one, you could get in some big trouble for doing it. Okay? That’s the big thing. The second thing is, even if you couldn’t get in big trouble for doing it, uh, you are going to, uh, be at risk, or you are going to be at risk of someone else controlling your credit. And that’s a major no-no in my book. Okay?
- 03:28 Um, so, tradelines, stay away from them. Bad news. No good. Okay?
- 03:32 Also, one other quick fact. In the old days, maybe about a decade ago, it used to be, when you did become an authorized cardholder on someone’s credit card, you actually got all of the previous reporting for that, uh, for that account on your credit report instantly. So, you could be a 19-year-old, become an authorized user on your parent’s credit card and all of a sudden you could have 20 years worth of credit history. Uh, you could have credit history longer than you’re actual age, right?
- 04:01 Um, no longer happens. The day you become an authorized cardholder, that’s the day you get, uh, credit for it, okay? So, don’t fall, uh, for the scam that, “You’re going to have 20 years worth of positive credit history from American Express because you’ve been placed as a cardholder on someone’s account.” It’s just totally false as well. Um, so another reason to stay away from buying tradelines.
- 04:24 The fourth reason is, it’s ridiculously expensive. Why, in God’s good name, am I going to give you a thousand, two thousand, five thousand … I’ve heard of some people paying five thousand dollars to buy tradelines … when I can go to my local bank or credit union, get a prepaid credit card, or excuse me, a secured credit card, in my name, that I control, okay, for five hundred bucks. Okay?
- 04:50 And it doesn’t cost me five hundred bucks, it’s just five hundred dollars worth of collateral I put up with that bank, okay? They hold it there. It’s still my money. It’s at the bank, okay? Why would I pay some company a fee when I can do this myself and get secured credit cards.
- 05:06 So, again, another reason. Four, five, there are a million reasons I could continue going down the list. So, guys, this is Nik Tsoukales, with Credit News Daily. Thanks for checking us out. You can reach out to us at www.keycreditrepair.com/freeconsultation if you ever have any questions regarding your credit, hit us up. We’re, uh, we’ll be standing by.
- 05:26 Have a great day. Bye.