Substituting tradelines for credit repair Tradeline compani..

Substituting tradelines for credit repair

Tradeline companies will tell you outright that buying tradelines is not a substitute for repairing your credit. Rather, tradelines are an effective way to temporarily boost your history.

To raise your score and make it stick, you need to practice good credit strategies over the long-term. This takes hard work and a real commitment to changing your money management habits.

Tradeline Alternatives

Buying a tradeline isn't the only way to improve your credit history. If you don't have money to spend on a tradeline or you're looking for a long-term solution to improving your credit score, there are several alternatives to purchasing a tradeline.

Pay Off Your Credit Card Debt

The average American has $6,354 in credit card debt. If you carry a lot of debt, paying off your credit cards can drastically improve your credit score.

In addition to saving you money in interest, reducing your credit card debt will improve your credit utilization, which is how much credit you have compared to how much you're using. Ideally, your credit utilization should be below 30 percent.

Paying off your credit card debt is one of the main steps toward lowering your credit utilization. Keeping your utilization rate below 30 percent can make a big difference in your credit score.

Dispute Errors on Your Credit Report

According to a report by the Federal Trade Commission, 1 in 5 Americans has at least one error on their credit report. If you don't review your credit report on a regular basis, you could be missing mistakes that are bringing down your score.

Under federal law, you're entitled to receive one credit report every 12 months. You can get your free report by visiting annualcreditreport.com.

Once you have your report, you should look over it carefully to make sure the information listed is accurate. If you spot an error, you should dispute it with the credit bureaus.

Open a Secured Credit Card

A really low credit score can make it impossible to buy a car, rent an apartment, or even get interviewed for jobs. If your score is extremely low or you're completely new to the world of credit, you can build credit with a secured credit card.

With a secured credit card, you make a small deposit up front. The card issuer hangs onto this money as a sort of security deposit in case you default.

In most cases, your security deposit is the same as your card limit. Once you have your card, you can charge purchases to it and then pay them off.

As you make your payments on time, the card issuer reports your positive payment history to the credit bureaus. Many card issuers give you an option to upgrade to a regular credit card after a certain period of time.

Take Out a Credit Builder Loan

Another non-tradeline option for repairing your credit is a credit builder loan. With a credit builder loan, you essentially borrow money from yourself.

These loans work in a bit of a reverse way compared to a regular loan. When you take out a credit builder loan, you don't receive the loan right away.

Instead, you pay money into a savings account each month. At the end of the loan term, you receive the balance in the account plus any interest you accumulated.