Imagine your entire financial obligation to be on a credit that is single (donвЂ™t worry вЂ“ it is simply hypothetical!) Imagine your overall stability on that imaginary bank card is $2,300 along with your total borrowing limit on that exact same imaginary card is $2,500. You have got a bad financial obligation utilization ration, because youвЂ™re making use of the vast majority of your available credit. Now letвЂ™s imagine that exact exact same $2,300 stability for a card by having a $10,000 restriction. Even though youвЂ™d owe exactly the same buck quantity, youвЂ™d have actually a far greater financial obligation utilization ratio because youвЂ™d be utilizing a great deal less of one’s possible financial obligation as a portion of whatвЂ™s available.