cancel
Showing results for 
Search instead for 
Did you mean: 

Are charge cards considered credit cards?

Valued Contributor

Re: Are charge cards considered credit cards?


Drew wrote:

bigblue7722 wrote:

Drew wrote:

I was looking at the FICO algorithm and comparing it to my current credit profile.  I see that FICO is more forgiving on thin credit files with 6+ credit cards versus 3-5.  I, however, only have 5 credit cards and 4 charge cards.  Are charge cards considered credit cards according to FICO or are they not taken into consideration?


What do you mean by more forgiving on thin credit files if you have 6+ cards?


There is a FICO score spreadsheet that simulates how FICO is affected by aging of accounts, opening of new accounts, etc.  This speadsheet indicates that 3-5 credit cards has a lower starting score than 6+ credit cards on the FICO algorithm.  I'm not sure if that is 100% accurate though.

 

That brings me back to my original question:  are store cards considered credit cards according to this model?  Currently, I only have 5 actual credit cards (two of which are Visa Signature that report credit limits) and 4-5 store cards.  Should I be applying for another credit card?

 


I believe store cards are considered credit cards and factored into AAOA and Utilization. Charge cards (depending on the FICO model) are open accounts and balances are not factored in your utilization, but it is in your AAOA.

 

I dont think the algorithm is 100 percent accurate.

Message 21 of 22
Highlighted
Moderator Emeritus

Re: Are charge cards considered credit cards?

I remember when Mastercard used to be Mastercharge.   Smiley Happy

Starting Score: 504
July 2013 score:
EQ FICO 819, TU08 778, EX "806 lender pull 07/26/2013
Goal Score: All Scores 760+, Newest goal 800+
Take the myFICO Fitness Challenge

Current scores after adding $81K in CLs and 2 new cars since July 2013
EQ:809 TU 777 EX 790 Now it's just garden time!

June 2017 update: All scores over 820, just pure gardening now.
Message 22 of 22