Typically, the three chords used are the chords on the tonic, subdominant, and dominant (scale degrees I, IV and V): in the key of C, these would be the C, F and G chords. Sometimes the V7 chord is used instead of V, for greater tension.
Lou Reed said "One chord is fine. Two chords is pushing it. Three chords and you're into jazz."[3] Reed nevertheless wrote many songs with unique or complex chord progressions himself, such as the material on Berlin.