Question

You have a credit card with an existing balance of $1,569.34, a credit limit of $2,000.00, and an interest rate of 12.5% APR. You pay $150.00 a month. When will the balance be below the target debt ratio to improve your credit score

Answer 1

Answer:

In seven months

Explanation:

Your credit score will begin to increase once you lower your balance to approximately 30% of the available credit. That means that you should try to lower your balance to only $600, assuming you stop using it.

If you are paying $150 per month, with a 12.5% APR, then it will take you seven months before your balance is approximately $600 ($604 to be exact).