A new “side hustle” is getting some attention on TikTok — the selling of tradelines. For a fee, a person with bad credit is added as an authorized user to someone else’s credit card account, allowing them to piggyback on the account holder’s good credit history.
These so-called “tradeline companies” have existed since the mid-2000s, but have now found a new audience on TikTok, where users are promoting the potential to earn hundreds of dollars per month by selling access to their credit card accounts. The demand is driven by consumers looking to quickly boost their credit scores, as a positive tradeline can have a significant impact.
However, this practice is controversial and carries significant risks. Credit rating agencies like FICO have updated their formulas to “protect scores and lenders from potential gaming” of the system through paid tradeline arrangements. Additionally, legal experts caution that knowingly misrepresenting one’s credit profile to banks could potentially constitute fraud.
Experts warn that by adding a stranger to your credit card account, you are putting a great deal of trust in that individual and the broker who will have access to your account details. Tradeline companies emphasize that the authorized user will never get you details, but they can call the card issuer and ask for a “replacement card” to be sent to their address.
There are concerns about unauthorized purchases, identity theft, and even the potential for your account to be shut down by the card issuer. The legality of these arrangements remains murky, and there is potential for criminal charges in some cases.
Despite the risks, the allure of easy money has driven the tradeline selling trend, with some users claiming they can earn hundreds of dollars per month. The amount varies widely, though. According to Finmasters, people can earn anywhere from $50 (or in the case of the TikToker above $40) to $350 per authorized user per month depending on the total credit score, the credit limit, the age of the card, and sometimes even the card issuer.
Information for this story was found via Forbes Advisor, Finmasters, and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
