How a Credit Card Can Help Your Credit Score

Your credit score can help you open doors to home ownership, the apartment of your dreams, a new car, and more. If you are looking to increase your credit score and don’t have a credit card, opening one could be the perfect solution for you.

A credit card can bring diversity to your credit history.

About 10% of your credit is based on types of credit. If you only have one type of credit, it can lower your score, by adding a credit card you automatically add a secondary type of credit.

A credit card can help lower your credit ratio.

About 30% of your credit score is based on how much of your available credit you are using. If you only have a loan on your account that can affect your score. By adding a credit card and using less than 20% of your available credit each month you can increase your score.

A credit card can give you more payment history.

About 35% of your credit score is determined by your payment history. Adding a credit card and always paying it off on time can add to your payment history increasing your score.

Two types of cards to help you get started

Here at Arbor we offer two types of credit cards.

Advantage Credit Card

• Perfect if you want a low-rate credit card

Rewards Credit Card

• Perfect if you want to earn rewards on everyday purchases.
  • 3x points on travel and restaurants
  • 2x points on gas and grocery
  • 1x point on EVERYTHING else

Opening a credit card is a great step in taking control of your finances and can help you build your credit. Want to ensure that you are on the right track before opening your card? Read our article “5 Best Practices for Credit Card Use” Looking for even more ways to build your credit? View your credit score in Mobile & Online Banking and set your credit score goal and get personalized suggestions.