Trick to Get 800+ Credit Score 🤫🤫 || bekifaayati #shorts

Your Credit Utilization Rate, also known as your Credit Utilization Ratio, is the amount of limit you're actually using divided by the total amount of credit you have available. In other words, that is the amount of your current debt divided by your credit limit. It is commonly expressed as a percentage.

For example, if you have a credit limit of Rs.1 lakh and have utilized Rs. 10,000 out of it, your Credit Utilization Ratio will be

(10,000/1,00,000) * 100 = 10%

Remember, your credit utilization ratio is calculated on the total of all your available credit and not just one credit card. So, if the total available credit from all your credit cards equals Rs.5 lakhs and you have used only Rs. 10,000, the credit utilization ratio is only 2%, which is good for your credit score.

The ideal credit utilization ratio is below 25-30%. It triggers an alarm once it goes over 30% and starts lowering your credit score.

If you have a low credit utilization score, it indicates that you are using less than what is available to you. This is usually viewed by credit rating models as an indicator that you're doing a decent job handling credit by not overspending, and keeping your spending in check will help you earn better credit scores

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