Are credit cards or personal loans worse for credit?

It depends. There are two main types of credit accounts—revolving debt like credit cards, and installment debts like mortgages, auto loans, and personal loans. Credit scoring formulas are a well-guarded secret, but installment debt is typically considered more favorably than credit card debt.

However, if you have credit cards with low balances and lots of available credit, they could potentially be a major positive factor in your credit score. In short, it depends on your loan balances relative to the original principal and your credit card balances relative to your available credit.

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