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Dana Coyle: Hi I am Dana with Complete Credit Services, we specialize in Consumer Credit building information for people all across the country. Today, we are going to talk about credit card balances. A lot of people have heard they shouldn't have a balance, they shouldn't have credit cards. How much in balance they should have? Well, we are going to give you the information that you need to increase your credit scores using one of the five parts of that score and that would be your balances on revolving account compared to the available credit limit on those same account. This is 30% of your FICO credit score.
Second largest part of your score is the Utilization Ratio of balances to credit limit. When you get your balances over 50% of the credit limit, for instance, $1000 credit card, more than $500 limit, your scores are going to go down, the closer you hit to being maxed out, the scores are really going to tank.
This can be anywhere from 20 to 75 points or more taken off for those balances getting higher than 50%, almost maxed out or maxed out. Now when your balances are under 50%, they help you score, how much under should they be? Optimally, you want them under 25% of the account credit limit, therefore $100,000 credit card, you want them under 250 and it's okay to have a zero balance on your credit card. You do not need to carry a balance every month for them to be included and figured into your score. We offer many more tips like this on our website completecreditservices.com, you are welcome and learn about how you can increase your credit scores and get better credit for your financial statements and for more financial options in your future, thank you, we look forward to seeing you on our site.
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