I have a low credit score. How can I improve it?

Consumer reporting agencies calculate your credit score based on the personal and financial information in your credit report.

You get points for things that show that you use credit responsibly or pay your debts on time. You lose points for things that show you have a hard time managing credit or paying your debts on time.

Your credit score or credit rating is supposed to show whether you are likely to pay your bills on time or repay someone you have borrowed money from.

Your score can range from a low of 300 points to a high of 900 points. Usually, a score of 700 or higher is considered very good or excellent.

Improving your score

Lenders, landlords, and other companies you want to do business with might want to see your credit report, credit score, and personal information. This helps them decide if you are a good credit risk and if you are likely to pay your bills or rent on time. Some businesses may decide not to do business with you if they feel your credit score is too low.

If you want to improve your credit score, start by getting copies of your credit report. Make sure the information in the report is correct. You have the right to change information that is wrong in your credit report. Fixing wrong information might improve your credit score.

If the information is correct, you can improve your credit score by paying your bills on time and not using more than 50-60% of your credit limit. It is also very important to pay off any past-due bills in full. Any regular bill that you pay in full each month will help improve your credit rating, like a hydro bill, rent, or car loan.