I usually keep my credit card usage under 30%, but last month I had to max out my limit. Now, my CIBIL score has dropped! How much does high credit utilization really affect the score? Has anyone recovered quickly after crossing the limit? Any tips to fix this fast?
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The use of my credit card exceeded upto 60% of my limit in one month,causing my CIBIL score to decrease. A credit score heavily depends on credit utilization because maintaining it under 30% is perfect while anything above it indicates increased credit usage that leads to lower scores.
The good news? The drop isn’t permanent.
The credit score began to improve after I made substantial payments before the following billing period ended. So work on maintaining utilization under 30% immediately and consider distributing expenses across different cards when possible.
lenders see credit dependence as a red flag- as the credit utilisation exceeds the required limit of 30 percent.
Excessive reliance on a single credit card creates a warning sign for lenders according to their evaluation of credit reports. Using different credit cards for my expenses helps me maintain low utilization rates on each account and my credit score has become stable. People who experience this issue should attempt to distribute their expenses across different payment methods.
spreading over spending.