Your credit utilization ratio is what you use out of the total credit available to you. Credit utilization only applies to revolving credit (i.e. credit card and line of credit usage), and it determines 30% of your overall credit score. The higher your usage, the more negatively it affects your credit score. Experts recommend keeping your usage below 30% of your total credit limit to improve your credit score.
You can figure out your credit card utilization by dividing your total credit card balance by your total credit card limit. Your credit utilization percentage is calculated based on your account balances as they appear on your latest credit report.
Theoretically, you could use 100% of your available card limit every month, but we strongly recommend against doing that. We recommended that you make payments to bring the balance down to below 30% before the end of the statement period. The credit bureaus look for consistency in paying off most or all your balance owing by the payment due date.