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Read this before opening a credit line
Installment or Revolving –Which is better for your credit score?
Revolving Accounts, are used for Credit Cards to obtain money to buy merchandise or to get cash advances repeatedly, as long as there is money available to do the transactions. Once a Revolving Account is paid off, it can be used again up to (and sometimes over) the credit limit. There is no need to open a new account each time money is needed.
Aside from Revolving Accounts are Installment Loans.
Installment Accounts are used to finance things like cars, student loans, unsecured loans, furniture, mobile homes, medical expenses, airplanes, boats and so on.
In a perfect world we pay cash for everything or at least we use our Credit Cards to pay for things and then at the end of the month, we pay off the entire balance.
We don’t live in a perfect world.
Most people don’t have a credit profile when obtaining student loans, so they are forced to open a student loan to pay for school. These loans are installment loans. The student makes installment payments until the balance reaches zero. Once the balance reaches zero, the account closes. If the student wants more money, a new installment loan is opened and the ... more
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