How to Improve a Bad Credit Rating

We all carry dozens of numbers in our heads: birthdates, ages, phone numbers, bank accounts and more. But there’s one crucial number that a whopping 37% of American adults do not know: their credit score.

Your credit score is a numerical value that banks and lenders use to decide whether or not to let you borrow money. People with low credit scores often have a difficult time securing loans, signing rental leases and getting good auto insurance rates.

The good news is that you can improve your credit score over time by developing better financial habits. Follow these guidelines to help your score begin its upward climb.


  • Regularly check your credit score and contact credit bureaus if you spot an error.
  • Make a list of all your debts. Write down the account name, the amount owed and the interest rate.
  • Prioritize paying off your debt with the highest interest rates first. (But don’t skip the minimum payment on any other accounts.)
  • Start to pay more than the minimum on your monthly credit card bills.
  • Set up payment reminders to help you keep on top of bill due dates. Some banks have special alerts like emails or texts that you can request.
  • If you must use a credit card, be sure to use the accounts with the lowest interest rates.
  • Alert creditors if you move or change names.


  • Submit any bill payments past their due dates.
  • Max out your credit cards. Keep your balance lower than your available credit.
  • Open additional credit cards.
  • Close your oldest accounts, even credit cards with zero balances. These accounts show lenders your history of paying back debts and can negatively affect credit if closed.