2007-07-22 07:38:09 · 4 answers · asked by John 2 in Business & Finance ➔ Credit
OC does a good job explaining it, but left out one thing.
A major portion of your credit score is determined by your "debt to credit" ratio. They take the total amount of your debt in relation to the total amount of credit limits you have.
Example, lets say you have two cards with $1000 and $2000 credit limits, and you have both nearly maxed out ($900 and $1800). Your ration is 90%. The credit bureau's want to see it at around 25%.
Remember this is only one factor, but having such a high ratio will lower your credit score several points. You need to stop your credit spending and get your balance down.
2007-07-22 08:39:48 · answer #1 · answered by Anonymous · 0⤊ 0⤋
Directly does it hurt..No, Indirectly..Yes.
When you pay the minimum you will still be reported to the Credit Reporting Agencies as paying as agreed. This is a good thing on your report. However, your balance is barly going down if you just do the minimum, as a majority of that minimum is going to interest. So it does nothing to lower your utilization, so it does not help your score to improve. If you pay the minimum once in a while it won't be that big of an issue, except that you are paying interest when you might not need to.
Now, if you constantly make just the minimum the company may feel that you are having trouble making the payments and consider you a higher risk. This could cause your credit limit to be decreased, or even have your account closed. If either of these happen, your credit score will go down.
2007-07-22 14:45:40 · answer #2 · answered by OC1999 7 · 0⤊ 0⤋
No, but having high balances can hurt credit.
2007-07-22 15:38:59 · answer #3 · answered by Luke D 2 · 0⤊ 0⤋
No,,, but it shure is going to hurt your pocketbook all you are paying is the interest..
2007-07-22 14:42:28 · answer #4 · answered by dr.pepper106 7 · 0⤊ 0⤋