You probably already know that not all tradelines are created equal. Some companies sell cheap and shady lines that offer few benefits if any. Other companies sell high-quality tradelines that cost more money. Even these reputable companies often have different prices for various tradelines. That superior factor that affects pricing is the age.
The Importance of Age
Credit Karma reports that there are five main facctors affecting your credit report. Here they are in order of importance:
- Payment history
- Credit usage
- Credit history length
- Credit mix
- Credit inquiries
How Age Ties in With Payment History
While payment history is the most important and accounts for 35% of your score, it depends on the length of your history. If you have a flawless payment history but your oldest account is only a year old, for example, that won’t mean much of anything. You could apply for credit with a score in the 700s under these circumstances and get denied. The reason given on your denial letter may say that your credit history is too new or has insufficient data.
Tradelines help to bolster payment history by giving it some context. A flawless payment history over a 10-year period says a lot more about a borrower’s dependability. In fact, a person with a 10-year history and one late payment may stand a better chance of getting credit at lower interest rates than someone with a one-year-old flawless credit history report.
The Factors Used To Calculate Age
How the age of your credit report is calculated may depend on the scoring model as well as the lender themselves. Some lenders may look beyond a general score to identify the components of the age of your accounts. Here are the main factors they identify:
- Recent credit activity on your accounts
- The average age of your accounts
- The age of your oldest account
- The age of your newest account
When you open new accounts, this negatively affects the average age as well as the age of your newest account. However, when you close an account, it remains on your credit history for up to 10 years. Ideally, you have another old account to replace it. When it falls off your credit report, your score may dip to reflect the new average age and age of the oldest account that’s next in line.
How Tradelines Can Help
There are a number of ways that tradelines can help you to boost your credit score by increasing the length and age of your credit history.
- Average Age: If your credit history is new, adding an older tradeline helps to improve the average age. Say, for instance, that your credit history is only a year old. You then purchase a tradeline that is 12 years old. The average age of your credit accounts is now six years old. If you add another account that is 10 years old, the average age climbs to almost 8 years.
- Age of Oldest Account: Using the example above, your average age would climb from one year old to 12 years old almost overnight. Coupled with a flawless payment history so far, this may cause your credit score to shoot upward. Even if you have a few flaws, they have a reduced effect over such a long span of time.
- Credit Inquiries: Sometimes, when you purchase a tradeline, you do end up with a hard credit check on your account. However, age of an account improves this, too. In most cases, a hard check involves adding a new account that drops your credit score, causing slow recovery. With older tradelines, you would be adding to the age, causing a bigger spike when it recovers.
Unfortunately, there’s nothing that tradelines can do about the average age of your newest account or recent activity. It will be up to you to hold off on adding new accounts for a time. You may also need to ensure you keep accounts active. One of the best ways to do this is to use a credit card to pay for everything and then pay the balance in full by the end of the month.
Buy a Tradeline
Are you looking for old, high-quality tradelines to boost your credit score? Coast Tradelines can help. Your financial future begins with this tradeline assessment to get you the tradeline that best meets your needs. If you have any questions along the way, send an email to [email protected].
