You’re a responsible adult. Credit Cards? Sure, you’ve got a few. Some of them are even just sitting in a drawer. You are savvy. You are the Harry Potter of credit card rewards. You haven’t looked at a credit improvement simulator in years. You get credit cards now to take advantage of points for trips or sign-on bonuses. Perhaps you have tens of thousands of dollars in available credit that you don’t even use. Perhaps there are cards you forgot you had that the only reason you remember they exist is because you see them occasionally on your credit report. But…besides the sign up bonus, and the slowly accumulating cash rewards (seriously, at 1 cent per dollar, or 5 cents per dollar, thanks for throwing us such generous bones multibillion-dollar conglomerates), you are not getting any benefit whatsoever from these cards besides their consistently growing age and providing your credit report with payment history (if you’re using them), but you can actually get paid money for your great credit. The first step, is to get familiar with an industry-wide term: trade line.
What is a Tradeline?
A tradeline is anything that reports on your (or anyone’s) credit report, a loan (a credit card is a loan, or potential loan if not being used) such as mortgage, auto, student, etc.
If you are looking to get into the business of selling tradelines, what do you need to know? Well, turns out, not too much, but you do have to be on top of a few things.
What Do I Need in Order to Be Able to Sell My Seasoned Tradelines?
In order for your credit cards to be viable as sellable tradelines, there’s a few things you need to make sure of. Do you have a perfect payment history on the card(s)? If not, then they are not usable. It is the payment history, in large part, that makes a paid tradeline so beneficial. If they have even one missed payment, they can do more harm than good. Do you keep your utilization below 10%, as in always? That is a huge part of being able to sell your tradeline credit. We have people–not often, but it happens–who will occasionally try to use their card and pay it off before the statement cycles, and if they miss it by a day, then a large balance can show up, and anything over 10% starts to affect the credit negatively. Usage works in tiers, from 0-9% you will see little to no difference on your report. The next tier is 10-29%, again you won’t see much of an effect, though you may at the upper level of that percentage. At 30% and up is when the score starts to drop. So just to be safe, we have a contractual limit on all of our cards. They must stay under 10%, always always always. Otherwise we have to refund/replace and cardholders don’t get paid and customers get mad and it’s generally unpleasant for everyone involved. And we like it pleasant around here. Finance is stressful and confusing enough as it is.
Do you use your card consistently? This one is the easiest of all the requirements. Using the card(s) is important because having a balance helps the lines to post and rescore the bureaus. One way to have this be consistent is set up a small recurring bill, like energy, or cable, or just put gas on the card once or twice a month.
Just as a general rule, you should be using your cards every month anyway. That is how you keep from losing them. Many people think the card belongs to them, that they own the limit, but that is not the case. The bank graces you the limit on your cards, and can take it away at any time, and often do, if you never use the card. The old saying “use it or lose it” certainly applies here. For people looking to purchase tradelines, an unused card is a worthless card. So, can you use any card as a tradeline?
What Kind of Cards Can I Use to Sell?
Do you have to have something really fancy to be able to sell your AU spots? Do you need to have black tradelines, like the mythical AmEx Black Card? No, you do not. As long as the lender is a major bank, you can probably sell the tradeline. When it comes to Credit Unions it does get a bit dicey, and for that reason we don’t sell those except for special exceptions. Some of the cards we sell are: Bank of America, Chase, Wells Fargo, Discover, Citi, USAA, US Bank, and more. If you have any of these and they have at least two years of history, we can sell them. And if you’re wondering how many authorized users can be on a credit card? Well, that’s different for each lender. Some allow five spots, some allow eight, some allow two. We don’t recommend maxing it out as that can be a lot of activity that may raise suspicion. In the business of selling/purchasing authorized user spots, there’s a fine line between being greedy, and being suspicious.