Over the years, I’ve had many clients who told me they had great credit. But, for many of them, the amount of credit they had available wasn’t the problem, it was how much of it they used. This is called “credit utilization”. By the time many people see me, their credit utilization is out of control. Ideally, a person should be using between 10-30% of their available credit. That means that if you have $10,000.00 in credit available, you should use no more than $3,000.00 of it, and pay the rest off.

So, see the article from the Chicago Tribune: http://articles.chicagotribune.com/2013-05-10/business/sc-cons-0509-save-credit-utilization-20130510_1_debt-to-credit-ratio-credit-card-credit-score

So, when companies offer you credit, they look at your credit score, and, they also look at the amount of it you use. You need to show that you are responsible with your credit. They want to know how long you’ve been using credit, and if you’ve been making payments on time. These are all important things to consider as you maintain your credit history, try to finance big-ticket items such as houses or cars, and, when you rebuild your credit.

Daniel J. Winter
BankruptcyLawChicago.com
312-789-9999
djw@DWinterLaw.com