As Credit Debt Rises, So Does The Demand For Tradelines
A confusing plethora of financial metrics and economical factors have placed credit card holders in a tough position over that last few months. While credit card companies are gaining record profits due to elevated interest rates, the average consumer is simultaneously using their credit card more than ever to cover the costs of living as inflation refuses to recede.
If you take a peek through popular news channels you can find a lot of valuable data on what's happening across the board financially, but the backstory for these happenings aren't always very transparent.
For example, in the last month alone we've been hearing quite a lot of talk about consumer spending. Positive talk, loaded with various statements about how the economy is holding strong and how the US consumer is actually spending more. Is this true? Well, yes consumers are spending more - but it's not by choice.
It's only when you take a look at inflation numbers that you'll realize consumers are spending more not because they want to, but because they have to. When the cost of living rises, expenses rise. With high household expenses it's simple to report that people are spending more, and it's also easy to show that yes, sales numbers are higher.
Another example: As prices for coca-cola rise, so do coca-cola's sales numbers. Well, that depends how you look at (and report on) the numbers. Does that mean people are buying more of the product? No. And it's even possible that people are buying slightly less coca-cola products, but the rising costs create net sales numbers that show a positive increase, at least in dollars.
When we take a deeper look at these situations, the clearer it becomes that people are relying more and more on their credit cards. There are however, still a lot of mixed messages.
Credit Debt And Delinquency Rising, Yet Credit Scores At All-Time Highs?
This may seem impossible, but this is the kind of information that the general public is dealing with, and it's completely contradictory. Credit card debt and delinquency is rising, yet credit scores are at an all-time high. Wait... What? Yes, you heard that correctly. It just depends where you look, and which data you pay attention to.
This article from CNBC shows that credit scores have hit an all time high. It was published this morning. But take a close look at the data being provided. using graphs and daata from April of this year which was 7 months ago, and by using 2022 data compared to 2010 data, the article makes a great case to support their story. They even admit that households are falling deeper into debt in the same article!
However, that doesn't mean this is what's happening today, after a long summer of spending and interest rates that have risen significantly since the data in their article went public. By the way, they also show credit utilization 3% higher than the year before... and if you know anything about credit scores, using more of your credit line does not result in a better score.
Now let's take a look at a different article from FOX News released about 10 days ago. It shows that credit card delinquency rates and balances are both on the rise due to 20 year highs on interest. Here's a couple quotes from a snippet of that article:
"Compared to other debt categories this quarter, credit card balances saw the most pronounced worsening in performance, following a period of extraordinarily low delinquency rates during the pandemic," The NY Fed said.
And as the costs of living remain elevated, many Americans are turning to credit cards to make ends meet.
"Credit cards are the most prevalent form of household debt and continue to become even more widespread," the NY Fed said in a blog post.
So what's really going on? Is there even a solid answer? It seems that twisted numbers and convenient statistics are playing a big role in some stories, while others are presenting the exact opposite.
As experts in the tradeline industry, we can tell you right now that as more people use their credit cards, their utilization rates rise. This results in fewer low-utilization cards available as tradelines for sale. While we still maintain an excellent inventory of cards here at GFS Group, the demand for more and better tradelines is slowly but surely increasing.
The Perfect Storm For Credit Sellers
If you have a card (or various cards) with excellent history, now is a better time than ever before to begin employing them to make extra cash. This is done by using a tradeline company like us to sell your great line of credit to those who are eager to buy it.
While you're not selling your actual credit card and while the user will have no access to your card info or the ability to spend, being an authorized user will allow them to improve their credit score so that they can lock in better loan terms, increase their chances of a favorable interest rate, and be more likely to be approved as a renter by a landlord or even an employee by businesses who perform credit checks prior to hiring.
The business of buying and selling authorized user tradelines has been steadily growing over the years, but with continued long-term inflation we find more and more people choosing to use their cards. This means that those credit lines are fluctuating too much and accumulating larger balances, making them inadequete for selling to authorized users. Remember, as demand rises so do costs, and again, this means that those with the best cards and usage history have the best leverage for making money as sellers. If you're one of those with clean cards to spare, you might want to inform yourself about how to sell tradelines today. It's a very simple way to make quick money with very little effort.
With Data To Back Our Statements, We Can See Where This Is Going
Of course, it's only fair to say that it takes time to process data, organize it, and publish it. Yet at the same time, it's quite simple to read the writing on the wall. At this time last year, credit card companies were already poised to make record profits thanks to higher interest rates, and consumers had already began to become more and more reliant on using their cards for everyday purchases.
However, when you fast-forward to today and see just how much the usage and spending has increased, it's very clear that the debts and delinquencies are rising rapidly, and that all-time records will be broken soon (again) as the data begins to seep in. An excellent display of this is shown in a recent consumer finance report published just 5 days ago. It shows that credit card companies made a record-breaking $130 Billion on interest and fees in 2022. Mind you that in 2022 while inflation was increasing and prices were creeping up, so were interest rates - and a year later they have continued to rise. In other words, 2023 - with much higher credit card usage and much higher interest rates than 2022 - will bring credit card companies even higher profits.
This pattern will continue moving forward, meaning that the demand for tradelines will continue growing for the foreseeable future. In fact, if this continual rising hits a certain point, the demand could become so high that the prices will rise drastically, meaning that selling your credit lines will become more profitable than ever before.
A Report On The History Of Tradeline Performance May Be Needed
We might just need to create our own report on the historical demand for tradelines, their prices, and their profitability in an upcoming article. If we do, you'll be sure to receive the most transparent information possible and the most genuine numbers available anywhere as they'll come directly from our own data. While we might not be able to speak for other tradeline companies, we can definitely paint a picture that provides honest insight that's up-to-date and easy to comprehend. We have nothing to gain by twisting the truth.
GFS Group has been in the industry for nearly a decade now and our reputation is practically impeccable. We continually strive for higher levels of customer service and any opportunity to improve our offerings for our valued clients. Rather than rush you into a sale, we'd prefer to be honest about where you stand, and even discourage you from buying tradelines if we don't think they can help you. How many other companies can say the same?
We'll continue bringing updates to you as we process the latest information, but our immediate forecast is one we feel quite solid about. The message is simple:
If you need tradelines or want to finance a large purchase, now is the time to make your move. If you want to sell tradelines to our buyers, now is the time to do it. We use the data available to us very wisely, and the numbers don't lie.
Tradelines For Sale: Learn Why Quality Improves Your Results