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Debt to credit ratio

tag
2Bfree
Regular Contributor

Debt to credit ratio

Can I get some advise here with my debt to credit ratio?  Credit summary shows that my debt to credit ratio is 97% which are student loans that are deferred.  Is this hurting my score since it is so high even if they are deferred.  It stated that having a high debt to credit ration on certain types of revolving (credit cards) accts and installment loans will typically have a negative impact.   
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tryingtogetitrightnow
Regular Contributor

Re: Debt to credit ratio

As far as I'm aware, it's only revolving credit that's looked at for the debt ratio, and student loans are not revolving, they're installment loans, but I'm no expert. :-)

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Current Scores: 11/23/13 EX 655; EQ 679; TU 705
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haulingthescoreup
Moderator Emerita

Re: Debt to credit ratio

trying is right. FICO scores do look at utilization (util; balance divided by credit limit) on installment loans, but it's calculated separately from revolving util, which is what we all tend to obsess about. Deferred student loans don't really hurt you much.

Do you have any revolving credit, in other words, credit cards? On these, you want to aim to have your util under 10%, both overall and on each individual card. If you have several cards, try to let only half or fewer report at any one time. FICO scores are driven by revolving credit more than by installment. It's good to have installment for the credit mix, but it doesn't make your scores swing up and down the way that revolving does.
* Credit is a wonderful servant, but a terrible master. * Who's the boss --you or your credit?
FICO's: EQ 781 - TU 793 - EX 779 (from PSECU) - Done credit hunting; having fun with credit gardening. - EQ 590 on 5/14/2007
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