If you want to get something that helps you, something you very much need, how concerned are you with legality? Well, it probably has a fair bit to do with what you are morally comfortable with, and the risk of getting caught; and, hopefully, consideration of how this affects others. We don’t often get the question of whether or not adding tradelines credit is legal, but it’s something we do want to go over, as you should know if you are getting into business with someone who is willingly breaking the law, or indeed, if you are breaking the law by purchasing tradelines.
Let’s make no mistake, there are plenty of things against the law that can be quite beneficial, or seem beneficial, all the way from insider trading to imbibing on illegal narcotics. You might get a temporary or permanent benefit on the spectrum of illegality, and you might get away with it, but asking are tradelines legal won’t give a simple “yes” or “no” answer, as in some are, some are not.
The Illegal Kind
Primaries. These things are what everyone thinks they want. We get questions all the time, can we add tradelines in the primary position? We believe that there is a bit of stigma around primary tradelines, and since everyone thinks they are the best possible thing under the sun since the production of coffee, what exactly is the primary tradeline definition? Any account that you own, that belongs to you, and shows on the credit reports, is a primary tradeline. For a credit card this means your ownership will say “Individual.” It will say this on all of your accounts that you alone are responsible for. If there is someone else underwritten on the loan, it will say “Joint.” When it comes to primaries, you should add tradelines yourself by getting approved for them in your own name, as paying someone to take debt that doesn’t belong to you and putting it on your report as if it did belong to you, or putting a debt on your report that you are not actually paying for, is illegal. That is fraud, pure and simple, and while you may not get in trouble for this, you are dealing with a tradeline broker who is committing felony fraud. And do you want to do business with someone who, at any time, may have his door kicked down by a financial watchdog entity?
The Legal Kind
When it comes to tradeline scoring, having something in the primary position may give a slight difference in score, but the truth is, if you put positive data on a properly cleaned, or blank, report, the scores will shoot up no matter what kind of data it is. We say this because the only real way to add a new tradeline on your report legally is with authorized user tradelines. These report in the secondary position, and your relationship to these accounts is, we’re sure you can guess, authorized user. What does this mean? The Fair Credit Reporting Act authorizes people to add users to their credit card. This means that the primary account holder is responsible for paying all charges on the card. This is why banks love adding authorized users, as it means more likelihood people rack up charges and incur interest fees. But if you are a tradeline master, you understand that adding authorized users doesn’t necessarily mean that the AU’s get the card. After all, that’s up to you. It’s a very common practice for parents to add their kids to their credit cards once they reach the age of eighteen, where–in most cases if the parent knows what he/she is doing–the score generated will be outstanding and set the young person up to get an approval or two to start building credit.
This isn’t so much about covering the pro’s and con’s of primaries versus authorized user, but here is where the AU tradeline is actually better than a primary, as a person can be twenty years old have a twenty year old account put on their credit. That is not possible with primaries, as clearly a person can’t have had credit since they were a one year old. That raises all types of red flags. Authorized user lines also usually have the benefit of being the cheap tradelines compared to primaries. At least that’s what the seller should have figured out, since he or she is risking jail time by selling them.
The most important thing to remember: primaries are best when you get approved for them in your own name, anything else is illegal business. Authorized User tradelines are the only legal way to add data that doesn’t belong to you onto your report.