A:

A Best Buy credit card can be used to help improve your credit score and credit history as long as you use the card responsibly. How you use the Best Buy card will ultimately determine how helpful it can be to your credit.

Understanding Your Credit Score

The Fair Isaac Corporation (FICO) credit score is calculated using five different categories of credit information. Most significantly, 35% of the credit score is based on payment history and another 30% is based on the amount owed on credit cards. Essentially, two-thirds of the overall credit score is based on how well you can pay off your credit card balance in full and on time. The remainder of the credit score calculation looks at information such as the length of your credit history and the frequency with which you open new lines of credit.

How the Best Buy Credit Card Can Help

If you use a Best Buy credit card but pay off the balance within the terms of the agreement, you will likely see an improvement in your credit score. Timely payments of any outstanding credit balances help you build a strong credit history and avoid paying any unnecessary interest and late fees.

Best Buy offers free financing on certain purchases for terms of up to 24 months. This means that it charges no interest if you pay off the full balance of the purchase on time. Doing so will likely result in a higher credit score, as it demonstrates to lenders that you can use the card responsibly and have the means to pay for what you have borrowed. A higher credit score can lead to potentially lower interest rates on mortgages and other loans in the future.

RELATED FAQS
  1. How does the number of credit card accounts I have affect my credit score?

    Your credit score, which is also referred to as your FICO score, is a measure that creditors use to assess your potential ... Read Answer >>
Related Articles
  1. Personal Finance

    Why Too Many Credit Cards Can Hurt Your Credit Score

    Find out why having too many credit card accounts can adversely impact your credit score if the cards are not managed properly.
  2. Personal Finance

    The Importance Of Your Credit Rating

    A great starting point for learning what a credit score is, how it is calculated and why it is so important.
  3. Personal Finance

    What Do Credit Score Ranges Mean?

    Take a closer look at what credit scores in each range mean for your financial future.
  4. Personal Finance

    How To Establish A Credit History

    Can't get a credit card without a credit history, and can't get a history without a card? Break the Catch-22.
  5. Personal Finance

    Credit Repair: How to Improve Your Credit Score

    There is no quick fix for a bad credit score, but there are several strategies you can take to improve your credit rating and save money over the long term.
  6. Investing

    Millennials: Prevent a Bad Credit Score

    Here are five ways to help prevent getting a bad credit score that could affect future loan, credit card or mortgage approvals.
  7. Personal Finance

    Five Easy Ways to Improve Your Credit Score

    If you credit score isn't where you want it to be, use these five steps to improve it.
  8. Personal Finance

    Credit Cards to Help You Recover from Poor Credit

    A poor credit score can put a huge damper on your finances. Thankfully using the right credit card can help boost your score and turn around your finances.
  9. Personal Finance

    Take the Right Steps to Build Excellent Credit

    There are several things you can do to protect and improve your credit score.
  10. Personal Finance

    6 Benefits of Increasing Your Credit Limit

    If you can resist the urge to overspend, then raising your credit limit could benefit you in various ways.
RELATED TERMS
  1. Credit Utilization Ratio

    An input used in determining a person's credit score. It is the ...
  2. Credit Card Balance

    The amount of charges, or lack thereof, owed to the credit card ...
  3. Balance Chasing

    The gradual lowering of a consumer’s credit limit by a credit ...
  4. Bad Credit

    A qualification of an individual's credit history that indicates ...
  5. FICO Score

    A type of credit score that makes up a substantial portion of ...
  6. Credit Limit

    The amount of credit that a financial institution extends to ...
Trading Center