Credit Utilization Guide
Credit utilization is the ratio of your current credit card balances to your total credit card limits. It accounts for approximately 30 percent of your FICO score, making it the second most important scoring factor after payment history.
What Is Credit Utilization?
The Ideal Credit Utilization Ratio
How to Lower Your Credit Utilization Fast
How Utilization Affects Your FICO Score
Frequently Asked Questions
What is the ideal credit utilization ratio?
The ideal credit utilization ratio is under 10% for excellent credit scores. Staying below 30% is the general recommendation, but lower is always better for your FICO score.
How quickly does lowering credit utilization improve your score?
Lowering credit utilization can improve your credit score within one billing cycle (30 days) since utilization is updated monthly when issuers report to credit bureaus.
Does closing a credit card hurt credit utilization?
Yes, closing a credit card reduces your total available credit, which increases your utilization ratio if you carry balances on other cards. It is generally better to keep cards open with zero balance.