Are Tradelines Legal?

Are tradelines legal is often ask by new clients and some new brokers also ask are tradelines legal. Yes, tradelines are legal.

Being added as authorized user is recommended by Experian.com,  CreditKarma & The President Of The FICO Corp.

Are Tradelines Legal

Some people against the use of credit tradelines argue that authorized users are manipulating the credit scoring system. They probably already have good credit.

The credit scoring manipulation argument, first off assumes that the current credit reporting system is fair to all. Parents and spouses benefit regularly.

It’s not fair, it’s flawed, Years of perfect credit history can be destroyed by missing only 1 payment or high balances. 6 of 10 credit reports have errors.

The truth is that the credit scoring systems are formulated by private (for profit) corporations, with the main concern being profit.

That can lead to biased systems, that favor the lenders. Some systems include more information to get a better picture of the credit worthiness.

This imperfect credit score system that scores authorized user tradelines decides the interest rates, amounts of credit issued.

VIDEO BELOW – The CEO of FICO Recommends  Being an Authorized User to Build Credit Fast

How Are Tradelines Legal?

In 1974 the equal opportunity act made it possible to be attached to another persons credit accounts and have the payment history reported.

To not include all things on the credit report when calculating credit scores is illegal it’s called discrimination and is illegal.

  • “After consulting with the Federal Reserve Board and the Federal Trade Commission earlier this year, Fair Isaac has decided to include consideration of authorized user trade lines present on the credit report ”Thomas J. Quinn – Vice President of Scoring Solutions, Fair Isaac Cor
  • FTC spokesman Frank Dorman said:  “What I’ve gathered from attorneys here is that it is legal, however, the agency is not saying that it is legal technically.”
  • This is possible because creditors generally have followed a practice of furnishing to credit bureaus information about all authorized users, whether or not the authorized  user is a spouse, without indicating which authorized users are spouses and which are not.  This practice does not violate Reg. B

– Robert B. Avery, Kenneth P. Brevoort,

Divisions of Research & Statistics and Monetary Affairs

Federal Reserve Board, Washington, D.C.

It is legal to be an authorized user to raise your credit scores and or to build credit fast.

Authorized User Law and Legal Definition. A person doesn’t necessarily need to be named on a credit card contract to be an authorized user.

When a person is an authorized user, he or she is authorized to use the card, but is not always responsible for paying.

Nonetheless, FICO still scores authorized user accounts. You should also use this law to your advantage

 

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