There many factors that matter in the determination of credit reports and credit scores. These measurements of someone’s credit worthiness greatly depend on the owner’s understanding of how to improve and maintain their credit worthiness ratings. One of the considered best practices in improving reports and scores is the utilization of trade lines. To be able to fully maximize the potentials of this tool, one must first understand its meaning and nature.
A trade line is simply a credit account. This type of account has many classifications which basically are installments accounts and revolving accounts. Installment accounts include any loan agreements, for example personal loan. On the other hand, revolving accounts are typically retails accounts or that from credit cards. The trade line could be any credit account under the sun like, auto loan, mortgage loan, even utility accounts, payday loans and cell phone bills.
Trade lines also show the responsibilities that the credit account holds. These responsibilities can be primary account, joint account, and user authorized accounts. Joint accounts are of course composed of two co signing parties. The credit score of the account will be determined by the current score of the parties. If one of the co signing parties has a low credit score then the loan application of the co signed party is more likely to be difficult to settle.
Technically, joint accounts are not good for those who would want to get and maintain a good credit score. If you are not married to the co-signing party then it is more probable that those who entered in a joint account are helpless and dependent on the credits of others. This character decreases the credit worthiness of the account holder, more specifically in the perspective of lending companies.
Authorized user accounts provide temporary boost in the credit reports and credit scores of the parties involved. It is simply temporarily transferring the current good rating of an existing account to someone else’s credit rating. This trade line tool is basically formulated for the benefits of family members. Unfortunately, people were able to tamper the use of this tool and started to make money out of this rating boost.
Credit repair companies used to use this trade line to repair existing credit reports and credit scores. But the new modifications in the FICO made the use of this trade line treated as an insufficient way of increasing reports and scores.
Primary accounts bear the greatest weight if you are trying to increase your credit score or dispute your negative credit report. These accounts put you as an “individual” rather than a part of someone else’s account. If borrowers are able to increase their primary accounts their credit scores and credit reports are most likely to follow.
The best credit repair companies are using primary trade lines to allow their clients get better credit score and favorable credit report. Utilizing trade lines is a good way to increase your credit score ranking because it accounts for 80% of the whole score. It includes three of the five variables used in determining the score- payment history, years of history, and low account balance.
Getting the right company like Personal Tradelines to do this work for you is the only thing you need to do. The increasing numbers of fraudulent companies this task that used to be a simple one slowly becomes harder to accomplish.