Are some credit cards better for building credit?

cards225If you have no credit history or you’re trying to re-build your credit after some past mistakes, you might wonder if some credit cards make you “look” better to lenders, or if certain cards boost your credit score more quickly.

The answer is no.

Your credit score is not based on any sort of judgment about the types of credit cards you carry, only about how you use them. If you make your payments on time, keep your debt low in relation to the size of your credit limit, and do so over an extended period of time, your credit will build in a positive way regardless of whether you hold a Visa from Chase Bank, an American Express Card, a store credit card from Sears, or a secured credit card.

This is good, because when you are starting out, you rarely will get the “best” credit cards in terms of prestige and you won’t get the best interest rates, either. All that really matters in terms of building credit, though, is whether the credit card or cards you carry report to 1 or all of the 3 major credit agencies — Experian, Equifax, or TransUnion. Major credit cards and large department store cards will almost always report to the credit bureaus. If you have a card from a smaller bank, and you are unsure of whether it reports, just ask.

(On a side note, one thing that does build your credit score faster is if you have varied types of credit, such as responsibly handling a mortgage or car loan at the same time as your credit cards. While you shouldn’t run out and get a mortgage to improve your credit, it’s good to know that having such a loan can help you improve your credit score.)

So, the good news is that almost all credit cards can help you build credit when used responsibly. On the flip side, this also means that there are no shortcuts, no ways to build credit fast (or faster) based on the type of cards you carry. Take it slow, follow the rules, and you’ll have a good credit history before you know it.