Credit card???

Question

my credit card has a 200 dlls. limit and it has been maxed out for 3 months. i have been paying 50 dlls. each month instead of the 10 dlls. required payment. Is my credit going bad because of this?

Answer 1

It's great that you're making payments on-time every month. This is good for your credit score. But the fact that your credit card is 'maxed out' is BAD. This lowers your debt / to available credit ratio - which will hurt your credit score.

Basically, creditors will think you're in financial trouble if you're using all your available credit and maxing out your credit cards. The best solution would be to pay down the balance of your credit card below 50% of your available credit. If your credit limit is $200, don't exceed a balance of $100.

Another option to improve this factor is to request a credit limit increase. If you've been making on-time payments, it's likely your current credit card issuer will raise your credit limit. All you have to do is call and ask. This will also improve your debt ratio.

As a last resort, you may want to consider opening a new credit card to increase your available credit. As mentioned before, don't exceed 50% of your credit limit and always pay on-time. Here's a good place to compare offers: http://www.wowcreditcards.com

Answer 2

As long as you are paying at least the minimum payment every month on time, it will not go bad.  If you are going over the limit, you are probably paying a lot of fees so stop using the card until you pay it off.  Then, never use it unless you know you will be able to pay the entire balance when the bill comes.