How long must trade lines be rated for an applicant?

In the context of the USDA Rural Housing Loan program, trade lines refer to the credit accounts that appear on an applicant's credit report. For an applicant's credit history to be considered sufficiently established, these trade lines typically must have been active for at least 12 months. This duration allows lenders to evaluate the credit behavior of the applicant effectively, as a year’s worth of payment history provides a clearer picture of their creditworthiness and reliability in repaying debts.

Having trade lines rated for this length of time tends to demonstrate that the applicant is experienced in managing credit. It showcases not only their ability to make timely payments but also provides insights into the applicant's overall financial responsibility and stability. This is particularly important for USDA loans, which aim to assist individuals in obtaining affordable housing, often in rural areas where housing options may be more limited. Therefore, a robust credit history enhances the applicant's chances for loan approval and favorable loan terms.