Just like a top football, basketball, or hockey player is drafted based on their stats, your credit score is used to determine your financial fitness. Because it measures your ability to repay loans, creditors use it to decide how much interest you’ll pay when you borrow money.

Improving your credit score may help you get approved for a mortgage, lower the interest rate you’re offered on a refinance, and reduce your insurance premiums.

Try these four tips from BMO Harris Bank to improve your credit score:

  • Pay on time. Paying on time every time may boost your score if you have missed payments in the past. If you need help paying on time, enroll in automatic bill payment programs.
  • Reduce your debt-to-credit ratio. Pay down your credit cards until you are using only 50% of your available credit. That will improve your debt-to-credit ratio, which can boost your credit score.
  • Use more than one type of credit. In addition to your mortgage, open credit card accounts. Having both types of credit in your credit history can improve your credit score.
  • Stick with the accounts you already have. Opening new accounts just to increase available credit means new inquiries on your credit report, which may lower your score. Avoid closing accounts you already have, which can negatively affect your debt-to-credit ratio and credit history — both of which rating agencies use to calculate your score.