Improve your credit rating

Your credit rating is something that helps potential creditors estimate how likely you are to pay back your debts.

Your credit rating is based on information about:

• how much debt you have
• whether you pay your bills on time
• whether you only make minimum payments on your bills
• whether you seem to have more credit than you can manage
• what kind of debts you have

There are things you can do to improve your credit score:

• Pay your bills on time and in full.
• Pay off any past-due bills.
• If you can’t pay off your bills in full, keep your account balances (such as credit card balances) below 60% of your available credit. For example, if your credit card limit is $1,000, keep the amount you owe below $600.

Don’t apply for new credit (for example, another credit card, or a furniture loan) unless you really need it. However, having a low-limit credit card or a cell phone contract that you pay each month can help you build credit – but only if you pay it on time and in full each month.