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Protecting your credit rating
Your credit rating, which is also referred to as a credit score or credit history, is a record of your ability to repay credit lent to you. In other words, it demonstrates how successful you’ve been at paying your loans. In order to establish a strong credit rating, you have to be responsible in your use of credit cards, loans and other credit available to you. Follow these do’s and don’ts for using your credit card to boost your credit rating.
Ways to boost your credit rating
In order to build your credit rating, follow these tips for using your credit card:
- Pay your minimum required payment each month and as often as possible pay your bill in full: It’s in your best interest to show lenders that you can pay your bills.
- Pay your bill on time: Monitor your statements so your payments are never late. A flawless or near-flawless payment history also speaks to your dependability.
- Choose the right credit card: Choose a credit card that meets your needs. For example, you may want to look for cards with cash back rewards you can use to pay down your balance or ones with an Installment Plan feature to spread out your payments at lower interest rates.
Ways to harm your credit rating
There are ways you can use your credit card that may lower your credit rating. To prevent this from happening, avoid these credit card mistakes:
- Maxing out your credit card: If you’re carrying a high balance on the card, it suggests that you are overspending. Lenders prefer to see you have a lot of credit available that you’re not using.
- Defaulting on payments: Few things look worse on a credit report than missed payments. Lenders will shy away from extending credit to applicants with a history of missed payments.
- Openly revealing your credit card information: Identity theft is a concern for all of us, especially credit cardholders, so do your best to prevent it by being cautious of where and to whom you disclose your information. CIBC does provide CreditSmart Identity Theft Assistance, but depending on the damage done and how quickly you recognize it, identity theft can negatively impact your credit rating until the issue is resolved.
Open a credit card with CIBC
Apply for a CIBC credit card online, at a local CIBC branch or over the phone by calling 1-800-465-4653. If you visit a branch or call us, you can also learn more about the credit protection services.