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Information on impact of multiple credit cards

Mark Cappel
UpdatedOct 4, 2007

Does having multiple credit cards affect your credit in a bad way if all are in good standing??

Does having multiple credit cards affect your credit in a bad way if all are in good standing??

Thank you for your question. Let me tell you a little about revolving utilization, it is the amount of your credit card's available dollar limit that you are currently using also called DEBT to AVAILABLE CREDIT ratio. Therefore, if you have a credit card with a $1,000 credit limit and an outstanding balance of $500, your utilization is at 50%. This is one of the factors considered while your credit score is calculated. The utilization is considered at an individual account level and also at an aggregate level (all of your open credit cards together). Higher the percentage of utilization, lower your score will be.

Many people are under the misconception that as long you use less than 50% of your available credit you will be fine. This is not the case at all. The optimal percentage is 10% or less. Please bear in mind that good repayment history, although an important factor is not the only criterion that determines your credit score. So, in your case, if you have many accounts, and if you have used up most of the available credit then it will definitely have a negative impact on your credit because , but if your utilization levels are generally low, then having multiple accounts does not have that great an impact.

The number of cards that you have active does not directly factor into your score number, but the credit history, that is, the accumulated average of how you pay, the amount you pay, when you pay, etc. on each card or any line of credit certainly does. Remember to carry cards with the best rate and the best service and keep the available credit on each high.

Just a tip: requesting an increase in credit limit may improve your score if you are carrying a balance. Remember the debt to available credit ratio that I just wrote about? The increase in credit limit may favorably affect that ratio if you currently have a high debt to available credit ratio. Be careful not charge up the new credit limit, higher balance or the improvement will be short-lived.

If you are looking at ways to improve your credit score, I would also suggest that you look at our credit help page at

I hope that the information I have provided helps you Find. Learn. Save.