Credit mix is the variety of credit accounts on your credit report, mainly revolving accounts like credit cards and installment loans like auto, student and mortgage loans. It makes up about 10% of a FICO Score, so it can help a little, but it’s rarely worth opening an account just to improve it.
Scoring models look at your mix because handling different kinds of credit well gives lenders more information about how you manage debt. But it’s one of the smallest factors in your score.
This guide explains the types of credit, how much credit mix matters in FICO and VantageScore models, what a good mix looks like and what to focus on instead.
Key takeaways
- Credit mix is about 10% of a FICO Score, according to myFICO.
- The main types of credit are revolving (like credit cards), installment (like auto and student loans) and open-end (like charge cards).
- A credit card is revolving credit, not an installment loan.
- Payment history and amounts owed matter much more than mix.
- Opening accounts just for mix can add hard inquiries and lower the average age of your accounts.
What Is Credit Mix?
Credit mix is the types of credit you have on your credit report. According to myFICO, that can include credit cards, retail accounts, installment loans, finance company accounts and mortgage loans.
Only accounts that show up on your credit report count. A loan from a lender that doesn’t report to the credit bureaus won’t add to your mix, so if that matters to you, ask the lender before you open an account.
For the full picture of what goes into a score, see how credit scores work.
What Are the Types of Credit?
There are three main types of consumer credit: revolving, installment and open-end. Capital One describes them this way:
| Type of credit | How it works | Examples |
|---|---|---|
| Revolving | You can borrow up to a limit, pay it down and borrow again while the account is open | Credit cards, home equity lines of credit (HELOCs), personal lines of credit |
| Installment | You borrow a set amount and repay it in equal, regular payments by a set end date | Mortgages, auto loans, student loans, personal loans |
| Open-end | You can borrow and repay repeatedly, and some accounts have no preset limit | Charge cards |
myFICO groups accounts into the first two: revolving and installment. So when people ask about the two main types of credit, that’s the answer. A student loan and an auto loan are both installment credit. A home equity line of credit is revolving. Learn more about how a line of credit works.
Is a Credit Card Revolving or Installment Credit?
A credit card is revolving credit. You get a credit limit, you can carry a balance up to that limit, and as you pay it down you can use the credit again.
An installment loan works differently: you get the full amount up front and pay it back on a fixed schedule until it’s paid off. Because cards are revolving, their balances count toward your credit utilization, which is a much bigger scoring factor than mix.
How Much Does Credit Mix Affect Your Credit Score?
Not much. Credit mix is about 10% of a FICO Score, and myFICO says it most likely won’t determine whether you get credit from a lender. VantageScore doesn’t list mix as its own factor. Its “depth of credit” factor looks at the age of your accounts and also the types of accounts you use.
| FICO Score factor | Weight | VantageScore 4.0 factor | Weight |
|---|---|---|---|
| Payment history | 35% | Payment history | 41% |
| Amounts owed | 30% | Depth of credit (includes account types) | 20% |
| Length of credit history | 15% | Credit utilization | 20% |
| New credit | 10% | Recent credit | 11% |
| Credit mix | 10% | Balances / available credit | 6% / 2% |
Sources: myFICO and the VantageScore guide. myFICO notes the importance of its categories can vary from one person to another. See VantageScore 4.0 for more on that model.
What Matters More Than Credit Mix?
The biggest factors are the best place to put your effort:
- Pay every bill on time. Payment history is the largest factor in both FICO and VantageScore models.
- Keep card balances low. Lower utilization generally helps.
- Keep older accounts open when it makes sense, to protect the length of your history.
- Check your reports for errors. An account reported wrong can affect several factors at once.
If you find an error, you can dispute it with the credit bureau for free. The guide on how to dispute items on your credit report walks through it.
If you’d rather have help reviewing all three reports and following up on each dispute, a credit repair company can do that work with you. To see what’s on your reports, start a free credit review.
What Is a Good Credit Mix?
A good credit mix usually means a combination of revolving accounts, like credit cards, and installment loans, like an auto or student loan, all paid on time. There’s no required number of accounts, and you don’t need one of every type.
The VantageScore guide says showing you can handle both revolving and installment credit can help your score, because its depth of credit factor looks at the types of accounts you use. Still, myFICO points out that a score in the upper 700s or higher is possible without any installment loan history.
Should You Open a New Account to Improve Your Credit Mix?
Usually not. myFICO’s answer to “should I apply for every type of credit I don’t have?” is no. A new application typically adds a hard inquiry, and a new account lowers the average age of your accounts. Several applications in a short time can also look risky to lenders.
Experian gives similar advice: apply for credit only when you need it, avoid frequent applications and keep making every payment on time.
A better approach is to let your mix build as you actually need credit. If you need a car, an auto loan adds installment credit. If you’re building credit from scratch, a secured credit card can be a reasonable first step, as long as you can pay it on time.
Does Paying Off a Loan Hurt Your Credit Mix?
It can cause a small, temporary dip. myFICO explains that if you pay off your only active installment loan, having no active installment loans can lower your FICO Score. It also says the drop shouldn’t be viewed as permanent.
Paying off debt is still usually a good move. Closing a credit card is a different question, because it can raise your utilization. See does closing a credit card hurt your credit.
Credit Mix FAQs
Yes. Credit mix is only about 10% of a FICO Score, and myFICO says a score in the upper 700s or higher is possible without installment loan history. Paying on time and keeping balances low matter more.
They can, if the lender reports them to the credit bureaus and you pay on time. The CFPB lists credit-builder loans and secured cards as ways to build a credit record. For a secured card, it suggests asking the issuer whether it reports to the credit reporting companies.
Not for now. The CFPB says most BNPL lenders generally don’t report your payment history to the major credit reporting companies. Some providers now do: Affirm says it reports its plans to Experian and TransUnion, but that its activity doesn’t currently factor into FICO or VantageScore scores. An unpaid plan sent to a debt collector can still be reported.
Capital One classifies charge cards as open-end credit. You can borrow and repay repeatedly, and some charge cards have no preset spending limit.
Bottom Line on Credit Mix
Credit mix is the variety of credit on your report, mainly revolving and installment accounts, and it’s about 10% of a FICO Score. It can help a little, but on-time payments and low balances matter far more. There’s no need to open accounts just to round out your mix.
Ashley Davison
EditorAshley is currently the Chief Compliance Officer for Credit Saint, previously the Chief Operating Officer. Ashley got into the Financial world by working as a Logistics Coordinator at Ernst & Young. Coming from a previous career in education, she is eager to teach the world everything she knows and learn everything that she doesn’t! Ashley is a FICO® certified professional, a Board Certified Credit Consultant, a Certified Credit Score Consultant with the Credit Consultants Association of America, UDAAP certified, and holds a Fair Credit Reporting Act (FCRA) Compliance Certificate.
