Do store credit cards help your credit score?

Where you can talk about store credit cards, like gas station cards, department store cards, etc.
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Do store credit cards help your credit score?

Postby Nani » Mon Apr 15, 2013 10:28 am

Dear Friends,

I have total for 6 accounts out of which 4 are store cards. I am frequent purchaser so just to avail discounts in these stores and took them of ignorance and now understood these store cards have adverse effect in sanctioning new VISA/MasterCard’s.

Now one of my friends suggested me to close all store cards before applying for new credit card

Store Cards Limit /Opened
Kohl's 300/Aug-11
Macy's 200/May-12
Belk 1000/Jul-12
Amazon 950/Dec-07

1. Do more accounts fetch more credit score?
2. My credit score is around 700 and now wanted to apply for new credit cards, should I close all these store cards before going for new ?
3. Does closing these stores cards have an effect on age of credit history?

Appreciate your responses.


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Postby Rina » Sat Apr 20, 2013 8:28 pm

Hi Nani,

Welcome to the forum.

There is no need to close your store cards, because you have already taken a hit in your credit score for them. Closing them is not going to restore those few points that you lost. You should wait a little bit longer, until all of your cards are at least one year old, and until your score is back above about 715 in order to apply for different types of cards.

If you have a mortgage, student loans, or a car loan, any of those things can further show diversity in your credit profile. However, you should not go into debt just to increase your credit score. You may have to be a little bit more patient, but having a strong income and minimal debt will increase your card limits, so in the end that is the better strategy.

Since you have a Macy's card, you can use it in order to propel yourself to higher limits. Just spend and repay as quickly as possible, and then call them to receive the card product that is commensurate with your new spending level.
Charge & Credit Cards: 121.8K+ (AmEx Platinum: NPSL; Bank of America Cash Rewards: 50k; PenFed Platinum Cash Rewards: 28.8k; PenFed Pomise 21k; Chase Marriott Rewards: 13.5k; Citi Simplicity 5k; Chase Slate: 3.5k)

Store Cards: 24.9k (The Home Depot: 16.5k; Nordstrom: 6k; Macys: 1.2k; DressBarn: 1k)

LoCs: 19.5k (Credit Union: 17.5k; Tertiary Bank: 2k)

Total: 176k+ (including min 10k tested on AmEx)

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Postby CCG » Wed May 22, 2013 1:52 pm

Yes, store cards do help your credit score, assuming you manage the account(s) responsibly. However it's important to also have major credit cards (Visa/MasterCard/AmEx/Discover).

If you need some recommendations of entry level unsecured Visa/MCs, then check out this page which has our top sponsored picks for 2013.

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Postby im_mr_awesome » Wed May 22, 2013 7:09 pm

I have several store cards (Best Buy, American Eagle, Kohls) and I can say they can help your credit score, IF you use them responsibly. When I first got my Best Buy card, I maxed it in less than a year. I didn't think about the consequences of that, and now it's my biggest monthly expense after my car payment. Be careful with them because of the high APRs.

I'd suggest paying down all your store cards if they have balances and use them sparingly. Don't carry over 20-30% balances and you should be fine. Avoid having too many cards with balances, as I've seen that as a reason for credit denial.

Having many accounts *can* help your credit score, but only to a certain extent. It's more about having a good credit mix (revolving cards, loans, mortages, etc) and not having too many of one type of account. Having too many credit cards with balances DOES hurt your credit.

Don't close your oldest cards unless they have annual fees you can't afford. Having old accounts in good standing helps your credit. When you have a prime card (Amex, Discover, Chase Freedom/Sapphire, and other similar cards) you can close some of these store cards if you want, but I don't see the point in closing good accounts. The only time I'd close old accounts is if you have even older accounts and they won't give you a credit limit increase. I've seen some companies refuse credit limit increases, but they will give you a new account with a higher limit. This could be the case for your Kohl's and Macy's cards, if you want higher limits on them.

Yes, closing the cards will affect your AAoA (average age of accounts) and will hurt your score. I'd open a new card like Chase Freedom, then wait about a year before closing an account. Replace another store card with a good card (Discover IT, for example) and then close another store card. Do this every year or two until you have really good cards and you'll be set. Ask for CLIs every 6 months to a year (soft pulls only for best score) and you shouldn't have any issues.

Then, if you want to open a store card later on, they will almost certainly give you a high limit $2k+ and you can get the rewards/savings and balance transfer them onto one of your really good Visa/MC/Discover/AMEX cards.

Hope this long post helps you!
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Postby MemberSince99 » Wed May 22, 2013 8:27 pm

There is some really good advice in here guys.

Just would like to add my own experience here. They do indeed open the door to "major" credit cards as well which can be harder to get (though Target for giving you a 200 limit is fairly hard to get for a store card). In 98 I had a department store card, that I put occasional purchases on and paid in full monthly. Within a year I was getting offers from Amex Chase and lots of others in the mail. So they can open the door to some really nice things.

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Postby brigitte-grisanti » Sun Jul 14, 2013 9:35 am

I have 4 Store cards and they help my credit. do not close them--They will kill your score---

Brigitte Grisanti


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