Using Credit Cards to Improve Your Credit

Credit Utilization

Having a good credit score is important. It affects your every day living. When you go look for a place to live – landlords check your credit to see if you will be capable of paying your rent on time. When you go looking to get a loan – whether you get approved or not, your credit score is used to determined this. So it is important to definitely take your credit score seriously. Although there are many ways to help improve your credit score, the easiest way is by having credit cards.

Here are a few tips how to use your credit cards to improve your credit score:

1. Pay on time – by paying on time, your credit report will show a good trend of responsible bill payments.

2. Keep using your credit cards while at the same time keeping your balances low. See Debt Utilization Ratio.

3. If you have a good amount of credit cards already, don’t open anymore. If you’ve got a less-than-perfect credit score and go opening new credit card accounts this may look bad on your credit report; also, your credit score lowers by a few points every time creditors check your credit.

If you’re using your credit cards to improve your credit, just remember to be mindful. If you borrow money, you should always pay back in a prompt manner. This will definitely help improve your credit  and will help open opportunities that otherwise would not if you had a poor credit history.

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