Types of Revolving Lines of Credit

Last week we covered the different types of credit available and stated that revolving lines of credit are best when building credit. Today we will cover the different types of revolving credit. All of these lines will still have the option to “revolve” or carry forward balances to the following month as we discussed in our last blog.

Credit cards are available to consumers from a variety of sources but we have listed them in order of most beneficial. Credit cards can be issued by: a bank or credit union, a non-bank, a retail store, or an oil company. Bank and credit union cards are commonly referred to as Visa or MasterCard accounts that are issued by your financial institution. Non-bank credit cards are issued by a financial institution that you do not use for your personal banking. Discover and American Express are examples of these non-bank credit cards. Retail credit cards are issued by the stores that you shop at. These include stores such as Macy’s, Target, Sears, and etc. There are hundreds of examples for retail credit cards. The difference in these cards is that they can only be used at the store that issued them, and a majority of them have smaller credit limits than bank or non-bank issued cards. Oil company credit cards work just as the retail credit cards, only being able to be used at specific locations such as Texaco, Shell, Exxon, and etc.

Bank and non-bank cards usually have an upper advantage compared to department store cards. The bank/non-bank credit cards usually offer higher credit limits which can reflect more responsible borrowing, and usually report to all three bureaus unlike a majority of department store cards. Since you may be limited on credit history or your past credit history may not be the best, regular credit cards can be a bit harder to obtain. A bank or non-bank secured credit card can be a great option when building credit. Secured credit cards normally require a deposit and reflect just as a normal credit card would on your credit history. Since your credit may not be as established or is less than perfect they do require this security deposit.

Once you have some history established with a secured credit card, it can make it easier to obtain bigger credit cards such as American Express or even a department store card that you may have your eye on. Visit us next week as we will cover how to use your credit cards properly to optimize the benefits of building credit with your revolving lines of credit. Have any questions or comments? Share them with us below!



MSI NEW LOGOMSI Credit Solutions provides superior credit restoration and comprehensive consulting services that are reliable and affordable. For any questions or to schedule a free credit consultation, contact us at (866) 217-9841.

 *The information in this article has been provided strictly for educational purposes.


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