Credit utilization
How much of your available credit you're using. Using a small share of your credit limit is better for your score.
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Related words
- Credit score
- A number, usually from 300 to 850, that tells lenders how likely you are to pay back what you borrow. Paying bills on time is the biggest factor.
- Credit report
- A record of how you've borrowed and paid back money. You can check yours for free at AnnualCreditReport.com.
- Credit card
- A card that lets you borrow money to pay for things. If you don't pay the full bill each month, you're charged interest on what's left.
- APR
- Annual percentage rate: the yearly cost of borrowing money, shown as a percent. It includes interest and some fees. Many credit cards charge more than 20%.
- Minimum payment
- The smallest amount you can pay on a credit card bill without a late fee. Paying only the minimum can keep you in debt for years.
- Loan term
- How long you have to pay back a loan, like 60 months for a car loan.
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