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How someone manages their revolving debt is an important factor considered in the calculation of FICO® Scores. With revolving credit, like a credit card, the lender will set a credit limit. The credit limit is the maximum amount you can charge to that account. When you make a purchase, you'll have less available credit by the amount of that purchase. Similarity, when you make a payment, your available credit generally goes back up by the amount of that payment.
Revolving credit accounts are open ended, meaning they don't have a certain end date. As long as the account remains open and in good standing, you can continue to use it.

FICO® Scores consider revolving account information reported on your credit bureau report in a number of ways:

  • How long the revolving account has been opened.
  • The balance on the revolving account.
  • The payment history on the revolving account (are there any late payments for example).
  • How much of your available revolving credit limit is being used (also referenced as revolving utilization percentage). For example:

$1,000 balance
$4,000 credit limit
25% utilization percentage

When developing the FICO® Scores our analysis consistently shows that the higher the revolving utilization percentage for a consumer, the greater the risk of that consumer not paying credit obligations as agreed. As such, people should try to keep their revolving credit utilization as low as possible.

Interestingly, the analysis also shows that having no revolving balances being reported (and thus having 0% revolving utilization), is slightly more risky than having a small balance/low revolving utilization reported. So, if you have low revolving utilization in your credit report this month and that gets updated to reporting $0 revolving balances (0% revolving utilization), you might see your score drop holding all else constant.

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Estimate your FICO® Score range

Answer 10 easy questions to get a free estimate of your FICO® Score range

Estimate for Free

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90% of top lenders use FICO® Scores

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IMPORTANT INFORMATION:

All FICO® Score products made available on myFICO.com include a FICO® Score 8, and may include additional FICO® Score versions. Your lender or insurer may use a different FICO® Score than the versions you receive from myFICO, or another type of credit score altogether. Learn more

FICO, myFICO, Score Watch, The score lenders use, and The Score That Matters are trademarks or registered trademarks of Fair Isaac Corporation. Equifax Credit Report is a trademark of Equifax, Inc. and its affiliated companies. Many factors affect your FICO Scores and the interest rates you may receive. Fair Isaac is not a credit repair organization as defined under federal or state law, including the Credit Repair Organizations Act. Fair Isaac does not provide "credit repair" services or advice or assistance regarding "rebuilding" or "improving" your credit record, credit history or credit rating. FTC's website on credit.