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How The Mix of Credit You Have Impacts Your Credit Score


10% of your credit score is derived from the type of credit you have on your credit report. What does that mean exactly? Contrary to popular belief, it does not mean that you should have an Amex, Visa, MasterCard, and Discover Card. Instead it means that you should have different types of credit lines open to improve or maximize your credit score.

For example, a good mix of credit should include:

  • A mortgage

  • A car loan

  • A couple of major credit cards like Amex or Visa

  • One or two department store or gas credit cards

If you don’t have a loan in each of these categories, it does not necessarily mean that you need to immediately run out and get them to raise your credit score. If your credit report only shows credit cards, improve your credit mix by asking other creditors to report your information to the bureaus. According to, creditors such as student loan lenders, credit unions and local retailers are not required to report credit information, but it never hurts to ask. Do not buy a car or anything else just to improve your credit mix score. It doesn't help your score enough to be worth the money you spend.

Remember, the types of loans you have only make up ten percent of your score overall. The most important factor in your credit score in undeniably carrying a low (or zero balance) and making on-time payments. Having a good mix of credit is like the icing on the cake – not the foundation of your score.

Caution: Do not close any established credit cards to reduce to this number because you also delete the corresponding credit history of the account, which can negatively impact your credit score. This factor becomes less important as the length of your credit history builds and there is more criteria available to use to calculate your score.

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