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Analyze Your Debt To Credit Limit Ratio

Monday, July 15, 2013 - 12:59 PM
From TheStreet.com:
If you've been extended a $1,000 credit line, you would assume that you're fine if you stayed within that limit and paid in full each time. The reality is quite different, because there's something called debt-to-credit limit ratio.

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The debt-to-credit limit ratio is one of the most important measurements in your credit scores and is calculated by dividing the total outstanding balance of all your credit cards by the total credit limit across all the cards. 

The article states that according to FICO, consumers with the highest credit scores on average have a debt-to-credit limit ratio of about 7%.   

The article also includes information to help manage the ratio. 
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