Utilization: why 30% is a lot and how to keep it at 10%

Utilization is the balance divided by the limit, for each card and for all of them together. It belongs to the "amounts owed" group of factors, which is about 30% of the FICO score, and unlike late payments it changes every month.

• You can use the card as much as you like: spend and top up ten times a day if you want. Only the balance on the statement date goes to the bureaus, not your turnover. Pay a day or two before the statement and a low balance gets reported.
• The rule: by the statement date no more than 30% of the limit should remain on the card, ideally under 10%. Pay off the rest after the statement and before the due date so you don't pay interest.
• Benchmark: below 30% is fine, below 10% is excellent, 0% on all cards is worse than 1–3% on one.
• One maxed-out card spoils the picture even with low overall utilization.

Three ways to lower it: pay twice a month; ask the bank for a limit increase (check whether there will be a hard inquiry); don't close old cards with a zero balance, they hold up your total limit.

In Alexander's case lowering utilization from 84% to 12% was the last step before the mortgage approval.