Credit card spending limit and credit score?

It's all about debt to credit ratio.

If you only have a total line of credit of 250.00, and you use up $87.50 of that credit line , then your debt to credit ratio is:

87.5 / 250= .35 or 35% of that credit line.

Lenders are looking for people who are not in debt.

They like to see debt under 19% or lower, for the best score.

My recommendation is to apply for another credit card so that you will have a bigger credit line.

Say you got a new card with a 500.00 limit.

Your credit line is now

250+500=750

You are now looking at a debt to credit ratio of

87.50 / 750=.11 or 11%

That's a good ratio!!

Having a bigger credit line helps witht debt to credit ratio. It is not going to matter though, if you are not looking for a big loan like an auto loan or a mortgage. That's where lenders get very picky about how much debt you have.

You want to try your best to keep your credit card at 20% if you plan to keep a balance on it. At 20% it will make your score go up. If you max your credit card out, it means you have a higher risk of not paying because you owe so much money and you are not paying it off.

By using a large portion of the card balance, for purchases or college fees, then repaying at end of billing cycle, your score & your available interest will slowly rise. It is not likely that chopping up the payments into bi-weekly parts will do anything positive. The biggest danger here is that temptation lurks for unnecessary spending, justified as "credit building" please don't buy anything with a card that you couldn't pay cash for & never carry a balance. Remember, when you earn a dollar you’re lucky to get 80 cents, but when you save a dollar you get the whole dollar. But you pay back financed whole dollars with earned shrunken dollars. So it often pays better to work at saving & avoiding interest, than it does to just work for money.

well.. at $250.00 limit it's almost like if you did not had any credit card.. I don't think that anyone actually care about if you have 250$ on your credit card..

as long as you pay on time every months, you're ok... it's not like if you owned $25,000

If your actual debt is close to your available limit, that is considered a higher credit risk.