Do Unused Credit Cards Hurt My Credit Score?

Inactive credit cards—those that are accounts available to use but that you’re not regularly using to pay for items—can damage your credit score in a few ways. Impacts to your credit utilization ratio First, your credit utilization on the account will be zero percent. That sounds like a positive thing, right? Well, yes and no. …

Installment Credit Versus Revolving Debt

What’s the difference between installment credit accounts and revolving debts? The answer impacts your credit score and/or the way a potential lender evaluates your financial picture. Let’s unpack these credit buckets. Installment Credit Installment credit is a loan that offers a borrower a fixed, or finite, amount of money over a specified period. Examples are …

Is a zero balance credit utilization good for my credit score?

Credit utilization refers to how much of your credit line(s) is in use; it’s also called your debt-to-limit ratio. If your cumulative limit across your three credit cards is $10,000 and you carry a cumulative balance of $1,500, then your credit utilization is 15 percent. (Less than 30 percent is recommended.) Is it better to …