Which credit utilization rate would be preferable to a lender on a credit card application?
43.0%
0 27.5%
O 83.0%
O 76.3%
When considering a credit card application, a lower credit utilization rate is generally preferable to a lender. In this case, 27.5% would be the most preferable credit utilization rate among the options provided.
Credit utilization rate is the percentage of your available credit that you are currently using. It is calculated by dividing your credit card balance by your credit limit. For example, if you have a credit limit of $10,000 and you have a balance of $2,750, your credit utilization rate would be 27.5%.
A lower credit utilization rate is seen as more favorable by lenders because it indicates that you are using a smaller portion of your available credit. This suggests that you are managing your credit responsibly and may be less likely to default on payments.
It is generally recommended to keep your credit utilization rate below 30% to maintain a good credit score. Lenders prefer to see that you are not maxing out your credit cards and are using credit responsibly.
So, in the given options, a credit utilization rate of 27.5% would be the most preferable to a lender on a credit card application.