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Are charge cards considered credit cards?

Regular Contributor

Are charge cards considered credit cards?

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?

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Message 1 of 22
21 REPLIES
Super Contributor

Re: Are charge cards considered credit cards?

 

Yes, both credit cards and charge cards are considered to be revolving credit.    However FICO scoring doesn't include the balance on charge cards in your revolving utilization calculations.

March2010 FICO® ~ 695 TU, 653 EQ, 697 EX
Message 2 of 22
Regular Contributor

Re: Are charge cards considered credit cards?


pizzadude wrote:

 

Yes, both credit cards and charge cards are considered to be revolving credit.    However FICO scoring doesn't include the balance on charge cards in your revolving utilization calculations.


Would a Visa Signature (or Flexible Spending Credit Card) be considered a charge card then?

 

American Express Blue Cash Everyday $25000
Barclays Sallie Mae World MasterCard $25000
Capital One Quicksilver World MasterCard $25000
Chase Freedom Visa Signature $25000
Discover IT $27000
US Bank Cash+ Visa Signature $25000
BofA Travel Rewards $18000

Message 3 of 22
Super Contributor

Re: Are charge cards considered credit cards?


Drew wrote:

Would a Visa Signature (or Flexible Spending Credit Card) be considered a charge card then?

 


Yes, assuming that the card doesn't display a credit limit on your reports.   I believe that most Signature cards are like this.

March2010 FICO® ~ 695 TU, 653 EQ, 697 EX
Message 4 of 22
Regular Contributor

Re: Are charge cards considered credit cards?


pizzadude wrote:

Drew wrote:

Would a Visa Signature (or Flexible Spending Credit Card) be considered a charge card then?

 


Yes, assuming that the card doesn't display a credit limit on your reports.   I believe that most Signature cards are like this.


Well, these specific cards actually do show a credit limit.

 

American Express Blue Cash Everyday $25000
Barclays Sallie Mae World MasterCard $25000
Capital One Quicksilver World MasterCard $25000
Chase Freedom Visa Signature $25000
Discover IT $27000
US Bank Cash+ Visa Signature $25000
BofA Travel Rewards $18000

Message 5 of 22
Super Contributor

Re: Are charge cards considered credit cards?


Drew wrote:

Well, these specific cards actually do show a credit limit.

 


If that's the case then any balances reported will be included in FICO revolving utliization.

March2010 FICO® ~ 695 TU, 653 EQ, 697 EX
Message 6 of 22
Valued Contributor

Re: Are charge cards considered credit cards?


pizzadude wrote:

 

Yes, both credit cards and charge cards are considered to be revolving credit.    However FICO scoring doesn't include the balance on charge cards in your revolving utilization calculations.


Hi,

 

Clarifiying question: I was told charge cards are considered "open" accounts and that the balance is not considered in utilization like you mention on certain FICO scoring models like FICO 08. Previous scoring models use the balances on a charge card in their utilization ratio.

 

 

Message 7 of 22
Super Contributor

Re: Are charge cards considered credit cards?

That's correct ~ the earlier TU98 version includes the charge card balances in utilization, whereas the 04 and 08 FICO models do not.
March2010 FICO® ~ 695 TU, 653 EQ, 697 EX
Message 8 of 22
Frequent Contributor

Re: Are charge cards considered credit cards?

Still trying to figure out why anyone would want a "Charge card"....  Unless you have a TON of income, and just need it for convienence.  Or just having an AMEX name on a card......


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Current Score: 753 TU, 764 EQ, 766 EX on 02/17/2014
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Message 9 of 22
Valued Contributor

Re: Are charge cards considered credit cards?


mtrsprt wrote:

Still trying to figure out why anyone would want a "Charge card"....  Unless you have a TON of income, and just need it for convienence.  Or just having an AMEX name on a card......


Because most people don't carry balances on their credit cards anyway and just use them for the benefits of using a credit card + the great rewards for spending. 

EX:694 TU:744 EQ:777
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Message 10 of 22