How Do Tradelines Impact Your Credit Report?

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How Do Tradelines Impact Your Credit Report?

Understanding how tradelines work can give you a better idea of how they affect your credit report.

For each revolving and installment account on your credit report, there is a tradeline connected to it. Revolving tradelines include lines of credit and credit cards. Installment tradelines include student loans, auto loans, mortgages, and personal loans.

What Information Do Tradelines Include?

Tradelines also include information about each account including:

  • Lender’s name and address
  • Account type
  • Partial account number
  • Current status
  • Account opening date
  • Account closed date, if applicable
  • Last activity date
  • Current balance
  • Credit limit
  • Monthly payment
  • Recent balance (for credit card accounts)
  • Payment history

This information allows you to obtain all of the information about your credit accounts in one place. However, given that lenders can have differences in how they report your information, the information may vary across tradelines.

Tradelines Are Used to Calculate Your Credit Score

Tradeline information is used to calculate your credit score. Because a credit score only provides an overview of your creditworthiness, potential lenders may also examine the tradelines listed in your credit report to get more information.

If you are behind on your payments, the lender might check to see how long the credit account has been delinquent. If your credit score has declined recently, a lender might check it and see that you have a high utilization rate by checking the balance listed on the tradeline versus your credit limit.

Here’s What Happens When a Tradeline Is Removed

When a tradeline is removed from your credit report, due to the authorized user of a credit card removing you from the account for example, the removal could have a direct impact on your credit score.

If the tradeline had positive information that boosted your credit score, the removal could mean a negative impact on your credit score. On the other hand, if the tradeline had information that would negatively impact your score, such as high utilization rate or late payments, removing the account could help your credit score.