A good credit score can enable you to obtain a credit card, take out a loan or even rent an apartment. A good credit score encourages lenders to loan you money. You may be able to get a lower interest rate on a credit card, allowing you to save money to put in your pocket or help while repaying your balance.

10 Things You Must Know About Credit

• Credit Isn’t Cash or a Cash Substitute.
• Having Good Credit Is Important.
• Good Credit Doesn’t Happen Overnight.
• Not All Credit Cards Are Created Equally.
• Debt Can Happen to Anyone.
• Creditors Share Information About You.
• You Can Review Your Credit History.
• You Can Ask for Lower Interest Rates.

Payment history — whether you pay on time or late — is the most important factor of your credit score making up a whopping 35% of your score. That’s more than any one of the other four main factors, which range from 10% to 30%.

Credit Bureau – A reporting agency that collects information on consumer credit usage. There are currently three main credit bureaus in the United States: Equifax, Experian, and TransUnion. Learn more about credit bureaus at usa.gov.

Steps to Improve Your Credit Scores

• Build Your Credit File.
• Don’t Miss Payments.
• Catch Up On Past-Due Accounts.
• Pay Down Revolving Account Balances.
• Limit How Often You Apply for New Accounts.

How to Build Credit Without a Credit Card

1. Pay all your existing loans diligently. Payment history is the most important aspect of your credit score, so pay close attention to your existing debt.
2. Installment loans can give your scores a lift.
3. Nonprofit lending circles.
4. Have your monthly bills added to your credit report.

Here’s how you can build your credit fast to buy a house.

1. Pay down your balances.
2. Set your bills on autopay.
3. Get added as an authorized user on someone else’s credit card.
4. Report any errors on your credit report.
5. Great credit takes time.

Ways to strengthen your 700 credit score

1. Set up automatic payments. A single late payment can take 100 points off your credit score.
2. Keep track of your credit utilization. The less you spend on your credit cards compared to their limits, the better it is for your score.
3. Watch for errors on your credit reports.

3 things you should do if you have no credit history

1. Become an authorized user. One of the simplest ways to build credit is by becoming an authorized user on a family member or friend’s credit card.
2. Apply for a secured credit card.
3. Get credit for paying monthly utility and cell phone bills on time.

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Paying an installment loan off early won’t improve your credit score. It won’t necessarily lower your score, either. But keeping an installment loan open for the life of the loan could help maintain your credit score.

The lender makes money off the monthly interest you pay on your loan, and if you pay off your loan early, the lender doesn’t make as much money. Loan prepayment penalties allow the lender to recoup the money they lose when you pay your loan off early.

Few lenders still charge a fee for paying off your loan early, called a prepayment fee. These fees ensure the lender makes money off your loan, even if you save on interest by repaying early.