Quick Answer
Credit utilization is the ratio of revolving balances to revolving credit limits - typically the second most influential factor in most credit scoring models.
Key Takeaways
- Lower utilization generally helps.
- Both per-card and aggregate utilization matter.
- Utilization updates as soon as the statement reports.
Why It's Updated Monthly
Utilization is recomputed each cycle when issuers report - meaning it can be one of the fastest-moving factors in a credit score.
Frequently Asked Questions
Is there a 'perfect' utilization number?
Educational sources commonly reference utilization under 30%, with the very top of scoring outcomes often associated with utilization in the 1–10% range.