A Revolving account is different than an Installment account, such as an auto loan, mortgage or student loan, which provides a lump sum at the opening of the account and has fixed monthly payments of the same amount each month.  The consumer cannot add to the balance of the installment loan, meaning you cannot say “I’d like another $2000, please put it on my auto loan.”    

Revolving accounts play a role in many parts of the credit score, including the second largest scoring factor, Amounts Owed.  This Utilization Ratio is the total credit limit available on your open accounts compared to the balances owed on those accounts.  Keeping account balances low generally helps your scores.  When the Utilization Ratio is over 50%, or half, of the credit limit, scores are usually much lower. 

A good strategy is to have 3-4 open credit cards with zero or very little balance.  Use them twice a year for a small purchase of something you were going to buy anyway, such as a tank of gas or a pair of socks.  Pay the bill in full when it arrives the following month.  You save money by not paying any interest, you keep the account open and active as a credit building tool and your credit scores should continue to increase as you follow all the parts of your Credit Building Plan.