Is it bad to have a credit card balance that is always close to the limit?

I have only one credit card, and it is the only credit card I have ever had. I am a college student. The card has 17% APR.


I have a credit limit of $1000 dollars, and I tend to only pay $100 dollars a month, and then spend again on it. So I'm always very close to the limit. Someone recently told me that this is bad for my credit. Is that true?|||Yes, this is bad for your credit score. 30% of your credit score is based on your "Debt-to-credit-limit ratio." If that ratio is high, then your score will go down, quite a bit.





The best thing, as far as your score is concerned, is to keep your balance under 25% of your total credit limit.|||very very bad.|||Yes, your credit score is suffering from it, and yes your finances are suffering from it.





You are paying $170 a year for the privilege of borrowing and paying back $100 a month. That is costing you big.





Also, anytime you utilize more than 30% of your credit limits, you will reduce your credit score. As your balance approaches the credit limit, then it really reduces your score tremendously.





Suck it up for a month or two and pay off a larger amount. To avoid using the card, lock it in a drawer instead of carrying it. You will pay it off.|||Unfortunately, yes. It is bad for your FICO score because it shows you are using all the credit available to you. Plus, with your payment history and the interest rate on that card you will be paying on that card forever. It would almost be better to have 10 cards with $1000 limits and only $100 on each card (but that wouldn't be realistic because you would have to break up your monthly payments 10 different ways).|||Yes, this is how your score keeps getting lower. Your using almost all of your credit line which tells your creditors your close to being overextended!





Look into the website below. This is a great one for learning how to clean up and repair your credit. If most knew how credit operates in the first place, there wouldn't be so much need to repair credit.





Get a subscription to a credit monitoring service. This way you can see what your doing to your credit directly, good or bad.





I got my score up to 720 from 485 with help from this site. Get the RSS feed too since new info gets added all the time!





You will find the section "how credit scoring works" section really helpful.|||It builds up gradually based upon how well you manage your loans and financial situation. However, the credit score can degrade at quite a rapid rate if there are consistent defaults on loan and credit card bill repayments. Repairing the credit score is not that difficult provided you take these 5 simple steps into consideration.





1. Check your credit report regularly





This is a must to ensure that you know your current credit score, and what is ailing it. If there are any inconsistencies in your credit report get them corrected. Keeping bills of all the transactions you make can be very handy and helpful in correcting any errors in your credit report.





2. Get rid of those extra credit cards





The temptations to own a new credit card are so numerous in modern times that many of us end up with a purse-full of them without any real need. They stay there and cause a lot of problems in repayment. The confusion that comes with too many credit cards can easy lead to a missed payment and resulting penalties. Frequent defaults will reflect poorly on your credit score. So, keep only the necessary and discard the rest.





3. Repay on time





Every credit card transaction is a loan that has to be repaid on time with interest. Don't ever miss out on any repayment. If you are not able to make full payments, make half, or even the monthly minimum, but don't default. This will keep you in the good books of credit card company and help your credit score. If you are not able to pay anything to the credit card company, don't shy away from them, call them, explain your problem and work out things so that a negative report doesn't land up with the credit reporting agencies. Read more from: http://www.credit-card-gallery.com/artic鈥?/a>