If one of your New Year's resolutions is to get better credit card rates, you need to raise your credit score.
Here is what makes up that score:
PAYING BILLS ON TIME: It's 35% of credit scores.
A 30-day late payment can cut high scores by 100 points and stay on your record for seven years!
There is no quick fix for past problems, but experts say don't ignore creditors. Instead, it can help if you try working out a payment plan with them.
AMOUNTS OWED: 30% of your score.
Try keeping as much space between the credit limit and amount you owe on all accounts.
Spread out debt trying not to use more than 20% on any account.
Try increasing your credit limit, and when you can, and pay more than minimum monthly amounts.
LENGTH OF CREDIT HISTORY: 15% of score.
NEW CREDIT: 10% of score.
CREDIT MIX: 10% of score.
Keep older accounts open.
While new credit can add to your limit and be a good thing, don't open too many accounts too quickly because that could work against you.
If you're having trouble getting credit, try a secured credit card. You put up the money that you'll be using. Still, banks and lenders report how you use it to credit bureaus establishing future credit for you.
So how important is a higher score? We used a myfico.com calculator, putting in a $400,000 mortgage loan and a 620 credit score.
By raising that score to 640, you could save nearly $50,000 over the life of the loan by getting a lower interest rate!
Click here to see what loan interest rates you can get with different credit scores.