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There are few large purchases you can make without the lender looking at your credit score.

If you want a car, a house, or even a big television, you are going to need a decent credit score for a lender to allow you to borrow money.

If you don’t have a great score, or if you do and just want to improve, here are some tips you should follow.

1. Know Your Actual Score

Before you can try to improve your score, you should know what it actually is. Every consumer has three credit reports from three major credit bureaus. A 2012 study from the Federal Trade Commission found that one in five consumers had an error on at least one of their credit reports. For this reason, you want to make sure all of your information is accurate on your credit reports.

2. Be Careful of Credit Card Balances

Roughly two in five Americans, or 41%, who have ever had credit card debt said they spend more than they could afford on unnecessary purchases, and those contributed to them going into credit card debt. First, you should never make unnecessary purchases that you can’t afford on a credit card. Second, you need to get your revolving credit to debt ratio down to 30% of lower. This means you should pay down your balances so you are only using about 30% of your credit limits.

3. Keep Track of Your Debt

Every time you apply for credit, it can cause a small dip in your credit score that lasts a year. This means that if you’re making multiple applications for credit, your score will keep getting hit. Newer technology makes this less of an issue, however, because they use formulas that allow you to make multiple applications but only take out one loan.

4. Pay Your Bills on Time

This one is the most obvious, but it’s still important. If you start paying your bills late, your credit score will start to drop. Make sure you are putting money into a savings account so you have the funds when it’s time to pay the bills.

Building credit does not happen overnight, but there are many things you can do it steadily help it improve. Make sure you are making smart financial decisions and one day, you’ll be able to get the lowest interest rate you’ve ever dreamed of because of your immaculate credit score.

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