- Pay your bills on time
- Reduce your credit card balances
- Check your credit report for errors
- Limit new credit inquiries
- Consider a credit builder loan or secured credit card
1. Pay your bills on time
Paying your bills on time is one of the most important factors in determining your credit score. Set up automatic payments or reminders to ensure you never miss a due date.
2. Reduce your credit card balances
High credit card balances can negatively impact your credit score. Aim to keep your credit utilization ratio below 30% by paying down your balances.
3. Check your credit report for errors
Regularly review your credit report for any inaccuracies that could be dragging down your score. Dispute any errors with the credit bureaus to have them corrected.
4. Limit new credit inquiries
Each time you apply for new credit, a hard inquiry is placed on your credit report, which can lower your score. Minimize new credit inquiries to avoid potential negative effects on your credit score.
5. Consider a credit builder loan or secured credit card
If you have a limited credit history or poor credit, a credit builder loan or secured credit card can help you establish or rebuild your credit. These products are designed to help you demonstrate responsible credit behavior and improve your credit score over time.