Utilization compares revolving balances with limits
Divide the reported credit-card balance by the credit limit and multiply by 100. Calculate both individual-card and overall utilization because scoring models may consider both.
Lower utilization is generally better
CFPB guidance says experts advise using no more than 30 percent of total limits, while paying balances in full can avoid interest and keep utilization lower. Thirty percent is not a guaranteed scoring threshold or a promise of a particular score.
Focus on sustainable financial choices
Do not move debt merely to manipulate a number without considering fees and interest. Pay on time, reduce balances according to a budget, and be careful when closing accounts because available credit can fall.
Official sources
Review the current government sources before acting because requirements and contact information can change.
CFPB: Understand your credit score