When you are looking at your credit report or learning more about credit repair, you’ll notice several companies and resources discussing tradelines and how they can help fix your credit score. You’ll get several different answers as to how more or less tradelines can affect your credit, but it is important to first understand what tradelines are so you can make better decisions about your credit restoration. This knowledge will prevent banks and other credit counseling services from fooling you by pushing you towards opening several tradelines at once in order to improve your credit.

Defining Tradelines

A tradeline is a credit account or a certain debt. It’s that simple. They are related based on who is the creditor on the account, when the account was opened, how much is on the account, and other details. Because they are given to the credit reporting agencies with these details, it is not uncommon for the same account to have multiple tradelines, but more on that later.

Types of Tradelines

There are several different types of tradelines, each based on the kind of debt accrued and how it is paid off and used. These types include:

  • Revolving Credit: This type of tradeline does not have a fixed amount for a payment, nor does it have a fixed number of payments. Instead, the payments vary each month on a revolving basis and can be used more than once as the available funds decrease when spent and increase again when debt is paid. A typical example, and one of the most common ones, is a credit card.
  • Installment Credit: This type of credit has a fixed number of payments, where the loan amount is given up front and used in full, then paid back over a certain period of time. Examples are student loans or home improvement loans.
  • Car Credit: This type of loan falls under the installment credit umbrella, and is a loan used specifically for the debtor to purchase a vehicle.
  • Home Mortgage: Again a type of installment credit, a home mortgage is a loan provided by a bank or creditor specifically for the debtor to buy a home.

Tradelines can be complex and sometimes cryptic, but they don’t have to give you a headache. At Empowerment Financial Group, we work with you to guide you through the process of credit repair, and we will always go out of our way to help you understand your credit score and everything involved. We know that bad credit can happen to anyone, and we don’t believe that you should have to pay thousands more because you’ve made a couple of mistakes in your credit history. Because we work closely with all of the credit bureaus, we are able to provide accurate information and help produce real results so you can get back to your life sooner.

Call our credit repair specialists today and get the help you need to understand and improve your credit score. Isn’t it time for your free credit repair consultation?