Do lines of credit affect credit score?
No, they do not. Lines of credit are a type of open-end loan and as such have no bearing on your credit history or score. If you pay off the balance in full each month, your account will appear to be paid off on your report. However, if you carry a balance for more than 90 days, it can negatively impact your FICO score.
The best way to avoid this is to make sure that you pay off any outstanding balances by the end of every billing cycle. This means paying at least one bill before the due date so that the payment is applied towards the oldest debt first. It’s also important to keep track of how much money you owe and what bills you still need to pay.
Lines of credit can negatively impact your credit score if they are used for personal reasons. If you use them to fund a business venture, they should help your score.