Yes, it’s common sense, but it’s the single most important thing you can start doing to improve your score. “There’s about a 50-to-60 point shift when you’re able to pay all your debts on time,” says Sarah Davies, senior vice president of research, analytics and product development at credit scoring firm VantageScore. If you have a significant amount of revolving debt, pay as much down as you can afford. While paying down a card with a higher interest rate makes more sense from a budgetary standpoint, if your main goal is to raise your score, pay off the card with the balance closest to its limit. Davies says you ideally want to use no more than 30 percent of your credit limit at any given time. If you use even less, all the better.
