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Can carrying high credit card balances affect one’s credit score?

On Behalf of | Jun 27, 2023 | Bankruptcy Law

Although there are many scenarios in which monetary challenges might arise, some sources of debt remain a prevalent concern for many families. Credit card debt is an issue that could take a dire toll on one’s life and those who carry high balances on similar accounts might not be aware of how this could affect their credit scores. Understanding the possible effects of carrying high credit card debts could help place individuals in Maryland in a better position to seek relief from the hardships involved. 

High balances on credit cards 

According to experts, carrying high balances on credit card accounts could prove detrimental to one’s credit score, even if a person continues to meet at least the minimum payment due each month. One factor that affects one’s credit rating involves one’s credit utilization ratio, which refers to the balance of the account in comparison to the credit limit. As such, carrying high balances on accounts could prove harmful to one’s credit, but sometimes this might prove unavoidable at times. 

Those who struggle to keep up with monthly payments may also have concerns about how a lapse in payments might affect their situations. Missing credit card payments may not only trigger costly late fees, but if the account enters default status, one’s credit score may suffer in the process. Experts also indicate that there are some scenarios in which carrying numerous credit card accounts might prompt a similar result.  

A brighter financial future 

Falling behind on financial obligations can prove harrowing under any situation and those who struggle with high credit card debts might not always know the best path to take to safeguard their futures. While preparing to explore the available options for relief can seem intimidating, this isn’t something one has to go through alone, as there are attorneys who can provide a person with sage advice in addressing his or her situation and options. A bankruptcy attorney can assist a client in preparing to pursue much-needed debt relief through the proper channels and provide insight on ways to begin building a brighter financial future.