It's been quite a long time since the inception of selling tradelines online. While we don't know a particular date or person who'd be considered the first to start doing so, the "boom" officially began around 2007 to 2008. The industry rose from seemingly nowhere - suddenly offering the benefits that come with being an authorized user on a strong credit card to the everyday consumer... Well, at least to those who were exposed to it.

Although buying and selling tradelines is still a lesser-known topic to the average Joe, the practice of adding authorized users to a credit card to help improve credit scores is not something new. For decades it's resulted in the newly acquired credit line showing up on authorized user's credit report. But that wasn't the initial reason for doing so, and that particular benefit may have even gone unnoticed for quite some time.

Let's explain.

At first, adding an authorized user wasn't about credit scores, it was all about credit equality and availability. It was most frequently carried out between spouses for the purpose of having credit available to actually spend. Women who were added to their husband's credit card as an authorized user were now able to hold their own card and have access to spend - something that wasn't really possible before.

Somewhere along the line, people noticed that if you were added to a solid card that had a positive payment history combined with a nice credit limit and some age attached to the account, your score would easily rise upwards, and often by an impressive amount. When those benefits became more clear, it also became more common for cardholders to add other family members (usually their children) as authorized users for no other reason than to improve (or priming) their credit scores.

In other words, a lot of these cardholders weren't giving a physical card or the ability to spend, just the gift of improved credit. Eventually, and with the introduction of the internet - savvy entrepreneurs found a way to monetize the same general idea and selling tradelines became a "pay-to-play" service.

The same method used by the parents (not issuing the physical card to their children but allowing them to reap the benefits on their credit report) is what allowed the business of buying and selling tradelines to be born and to thrive up until this very day. Of course there are a few major differences and that's where the confusion seems to come into play - that's why using credit card tradelines in this way seems to be the black sheep of the credit industry.

The Buyers, The Brokers, and The Sellers

The buyer of the tradeline is the person who "pays to play". Ideally, they'll be using a tradeline company or a broker to make their purchase. The broker furnishes the buyer's information to a cardholder and the cardholder adds the authorized user to their card. Once the card's statement day hits, the credit card issuer will typically furnish the most current info to the major credit bureaus, including the details of the newly added authorized user. Once the deal is done and the buyer's credit report reflects the newly acquired account (appearing on their credit profile showing them as an authorized user), the cardholder is paid a fee for successfully selling or renting that authorized user spot. When done properly, the results can be nothing less than jaw-dropping.

While it's not a permanent solution, this method of "buying tradelines" works extremely well in helping the buyer apply for their own credit lines (assuming their credit was already in good standing beforehand) with an increased level of creditworthiness. They may find themselves with seriously attractive interest rates, or lower down payments on large purchases involving installment loans. Likewise, they may find it much easier to be approved for revolving credit lines of their own. Either way the benefit is there, the demand is there, and the process works.

For the tradeline company who manages the sale, mitigates risk, and facilitates a smooth transaction, there is profit to be made from the sale of the primary cardholder's authorized user spot plus plenty leftover to pay the actual cardholder their commission. All 3 parties are required for this process to occur in a safe, secure, and low-risk manner.

Tradeline sellers, the cardholders who are adding the authorized users to their card aren't getting the small end of the stick here. Depending on the company they use and the overall limit and age of any given credit card they hold, they can make from $75 to $550+ for a single sale. That's not chump change considering they can safely have about 2 authorized users at a time. And when we begin to realize that many of these cardholders are working with 3, 4, 5, and even 10 or more cards, there's literally tens of thousands of dollars in earnings potential there each year. Not too bad for hopping onto their mobile app, laptop, or picking up the phone and calling the bank to add an extra user to their card.

The Doubts, The Disbelief, and The Discussions

Now comes the part of buying and selling tradelines being the black sheep of credit. If you approached someone and told them they could basically "rent" their credit card history out in exchange for some extra cash they might think you're nuts. There's a pretty good reason for their reaction too, and it's the simple fact that the idea sounds foreign and strange - maybe even shady or illegal. A lot of things seem that way if you don't know the facts. After all, we're taught to be careful with our credit and our personal information; and rightfully so. We're also naturally skeptical of things that aren't mainstream knowledge.

But if those people knew there was a proven system of safeties, risk-mitigation, and that adding an authorized user to their card doesn't mean they automatically receive a physical card and free reign to spend, they may be a bit more receptive. They may find it interesting. In fact, they may even decide that they want to become a tradeline seller themselves. Maybe not. Either way is fine, but whether or not they show interest or decide to sell, the at least deserve to understand that the process is something that's not fraudulent or going to land them in prison - a key aspect that far too many people presume. They should also know that there are several things keeping the authorized user from spending on their card, and neither the tradeline company or the authorized user has any of their card's sensitive information at any point in time.

When you sell your card as a authorized user tradeline, there's no way for the buyer to spend on the card because they don't have the actual card number or physical card. These are the same safeties that prevent the buyer from contacting the bank and making changes to the account, or trying to acquire a card of their own. Those abilities remain with the primary cardholder who receives the authorized user's card by default in the mail, thereby securing it physically.

Not Such A Black Sheep After All

All of these small details add up and make our "average Joe" much more informed about how this all works. Whether selling tradelines or buying them, the questions can be answered, the doubts can be explained, and the discussion can come to a point where everything is very clear. What was a totally crazy idea a few minutes ago seems more and more realistic, more interesting, and with greater potential to be legitimate.

We've written a lot of blogs here. We've covered a lot of the most important aspects of how and why tradelines work, the fact that they're not illegal, and all the details that continually go ignored. We've proven rumors to be wrong, we've shown where the risks sit, where the windows for opportunity are, and how an individual can easily make extra money or supercharge their credit profile - depending on which side of the business they operate on.

The business of buying and selling tradelines is a black sheep of credit because we as humans often repeat what we hear without studying the subject enough.

Through excellence in service, excellence in performance, patience, and a lot of hard work, GFS Group keeps pushing forward to make a change in the industry and its landscape. Not only to grow our business but to help people understand that they CAN safely implement this tool and leverage it to improve their credit for the long-run. Likewise to show cardholders that they can legally earn additional income without thinking they're committing fraud or being part of a organized crime ring.

It's always smart to know what you're getting into regarding anything related to finances. Beyond that, it's also smart to offer yourself a chance to expand what you know - little by little - so you can make educated decisions based on evidence, based on real answers, and based on facts instead of rumors or simple assumptions.

Buying and selling tradelines will most likely always be the black sheep of credit, but it doesn't have to be that way. The resources are there, the knowledge is abundant, and the industry is growing every day. If you're reading this, ask yourself why. Are you looking to enhance your credit profile? Do you have credit cards sitting around that can be put to good use making you extra money? Perhaps it's time to start digging deeper.