Quiz: What Affects Credit Utilization?


What is credit utilization? What role does it play in credit health?1. Your credit utilization ratio affects ___ percent of your credit score.

a.  15
b. 20
c. 30
d. 35

2. Cosigning a loan will affect payment history, not credit utilization.

a. True
b. False

3. The _____ your credit utilization ratio, the higher your level of risk.

a. lower
b. higher
c. steadier

4. Income has a direct impact on credit utilization.

a. True
b. False

5. Drew has $4,000 in credit card debt and a $16,000 credit limit. His credit utilization ratio is:

a. 15 percent
b. 25 percent
c. 32 percent
d. 35 percent

6. A dramatic increase in your credit utilization ratio could damage your credit score.

a. True
b. False

7. Credit utilization and debt-to-income ratio:

a. Measure the same types of debt
b. Measure different types of debt
c. Rely on each other to grade creditworthiness
d. None of the above

8. Mortgage debt affects credit utilization.

a. True
b. False

9. Leo has two credit cards, each with a $10,000 limit. He applies for a new card, also with a $10,000 limit. This action will:

a. Automatically lower his credit utilization ratio
b. Only affect the new card
c. Have no effect on his overall ratio

10. After marriage, your spouse’s credit utilization ratio will combine with yours to create a household utilization.

a. True
b. False


1) c; 2)b; 3)b; 4)b; 5)b; 6) a; 7)b; 8)b; 9)a; 10)b


0-4 Points: Under-Utilized

When it comes to financial health, you’ve wandered into scary territory. Although you understand the basics of credit card usage, you haven’t learned the benefits and dangers of credit utilization. Click here to learn some tips and tricks to help you along the way. Your credit score depends on it.

5-7 Points: Basically Balanced

You have a good understanding of credit utilization, but there’s always room for improvement. Do some research to learn how your ratio affects credit scoring. It’s also important to understand the difference between a credit utilization ratio and a debt-to-income ratio. Master these skills, and you’ll be on your way to greater financial strength.

8-10 Point: Ratio-Ready

You’re a credit utilization pro and your score reflects it. Keep up the good work and look for ways to keep improving. Credit health is a dynamic process.