A credit report seasoned trade line is a method of allowing strangers with bad credit to become authorized users on a credit card account of someone with good credit for a fee.  This is also known as piggybacking and can be very helpful to people who have bad credit and fear they will never be able to have good credit.  Of course, there is some controversy to the credit report seasoned trade line business.

The benefit to the person with bad credit will have an account with excellent credit history listed on their credit report which will raise their credit score.  The cost of a credit report seasoned trade line will run anywhere from $500 to $2,000 depending on the credit history of the new account.  The person with the good credit receives from $100 to $150 for this with the rest of the money going to the middle man that set up the seasoned trade line in the first place.

Of course, there is a risk for the person with good credit.  The person with bad credit may charge the credit card account and then not pay it back thus causing damage to the good credit person.  The brokers who provide the service claim that they never provide the entire account number to the recipient, however they may find it out anyway because the entire number may appear on some credit reports.

A logical question that comes about when exploring a credit report seasoned trade line is whether or not it is legal.  The FTC says that what they have been advised about from their lawyers is that it appears to be technically legal.  The agency, however, is not saying that it is legal.  The credit report seasoned trade line practice could be fraudulent if, as required by the contract, a borrower does not disclose pertinent facts relating to that person’s ability to pay back a loan.

Fair Isaac Company who is the inventor of the FICO score which is your credit rating says they will no longer take into account authorized users when determining a credit score.  That means that a credit report seasoned trade line practice may become obsolete.  

This is a double edged sword since it will stop the practice of seasoned trade lines appearing on credit report; however it will negatively affect students who use their parent’s cards and spouses with little credit history of their own.  A seasoned trade line can help a person with bad credit show good credit on their credit report, but it may not be legal and we think it won’t even be available in the future anyway.

What Are Tradelines Used For?

The information included in your tradelines is primarily used to calculate your credit scores. Because a credit score is just a snapshot of your creditworthiness, however, lenders may also check the tradelines on your credit report to get more information.

If you’re behind on payments with a certain account, for instance, a lender might check the tradeline to find out how long the account has been delinquent. Or if your credit scores have dipped because you have a high utilization rate on a credit card, a creditor can determine whether you’re really a credit risk by checking the balance versus the credit limit.

If your limit is $300, for instance, maxing out the card might not be as much of a red flag as if your limit were $10,000.

Check Your Credit Report Regularly

The tradelines on your credit report provide a wealth of information to both you and lenders. To make sure all the information contained in your tradelines is accurate and legitimate, check your credit report regularly.

You’re entitled to one free credit report from each of the major credit reporting agencies (Experian, Equifax and TransUnion) every 12 months. You can also get free credit monitoring and access to an updated credit report from Experian every 30 days when you sign in. As you review your tradelines frequently, you’ll have a better chance of spotting fraud and inaccuracies before they damage your credit scores significantly.