Posts Tagged "balance-to-limit-ratio"

Using credit cards to establish your credit history

Dear Experian,

I have been approved for two credit cards with two different limits and interest rates. One offers cash back rewards. I am trying to build my credit. Should I just use the card with the better terms, or should I use both?


How utilization rate affects credit scores

Dear Experian,

I have been led to believe that a component of one’s overall credit score is the ratio of current credit card balances to one’s total available credit. If one had three credit cards, is each card’s ratio calculated individually, or is it one’s total credit card balance compared to one’s total available credit? Also, I’ve heard that the important thresholds are 30 percent and better yet, 10 percent; is that correct?


Transferring balances shouldn’t hurt credit scores

Dear Experian,

Does the simple act of making a balance transfer lower your credit score and if so how much?


Balance-to-limit ratio applies only to revolving accounts

Dear Experian,

Does the balance-to-limit ratio only apply to credit cards, or does it apply to installment loans, such as student loans or auto loans, as well?


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