How does credit utilization work?

Question

For example, if I have a $250 credit line and spend it all in a month then repay it next month, will that raise my score?

In: 1

Answer 1

Depends on when your card balance is reported. If you use it all around the time you balance is reported even if you pay it off it will show as using 100% of your credit which is bad. You want to only use 30% max of available credit and in no time your score will go up