ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Simply put, a credit mix refers to the types of different credit accounts you have – mortgages, loans, credit cards, etc. It’s one factor generally considered when calculating your credit scores, although the weight it’s given may vary depending on the credit scoring model (ways of calculating credit scores) used.

Detailed explanation-2: -There are three types of accounts that commonly appear in credit reports: installment, revolving and collection accounts. The installment and revolving accounts can include different types of loans and cards, and they may help or hurt your credit scores. Collection accounts will never help your credit.

Detailed explanation-3: -Having both revolving and installment credit makes for a perfect duo because the two demonstrate your ability to manage different types of debt. And experts would agree: According to Experian, one of the three main credit bureaus, “an ideal credit mix includes a blend of revolving and installment credit.”

Detailed explanation-4: -information they collect and how your credit reports impact your credit scores. The three major credit bureaus are Equifax®, Experian® and TransUnion®. Credit bureaus are different from credit scoring companies, such as VantageScore® and FICO®.

Detailed explanation-5: -Revolving Credit. This form of credit allows you to borrow money up to a certain amount. Charge Cards. This form of credit is often mistaken to be the same as a revolving credit card. Installment Credit. Non-Installment or Service Credit. 21-Feb-2014