Many people know the advice to keep credit card utilization below 30 percent. Over time, that ceiling has been mistaken for a target.
Fair Isaac Corporation states that consumers with the highest credit scores maintain single-digit utilization rates. Keeping your utilization under 10 percent yields better scoring results than holding at 25 percent. The 30 percent threshold is a maximum limit before heavier point penalties kick in.
A subtle detail surprises many cardholders. Reporting zero balances across all your credit cards can score slightly lower than reporting one small balance on a single card.
Lowering your reported balance below 10 percent can lift your score within a single billing cycle.
What is your utilization sitting at right now?
