Which action can a borrower take to improve their credit score?

Paying bills on time is a fundamental practice that significantly impacts a borrower's credit score. Timeliness in bill payments is one of the most influential factors in credit scoring models, as it demonstrates reliability and responsibility in managing financial obligations. When a borrower consistently pays bills by their due dates, it fosters a positive payment history, which accounts for a large percentage of the overall credit score calculation.

In contrast, ignoring small debts can lead to negative consequences, such as missed payments reported to credit bureaus, which can lower credit scores. While applying for multiple credit cards might seem beneficial for increasing available credit, it can actually harm a credit score due to multiple hard inquiries and potentially signal to lenders that the borrower may be seeking more credit than they can manage. Increasing a credit limit can be helpful in some cases, particularly if it reduces the credit utilization ratio, but simply doing so without addressing other critical factors, such as payment history, does not guarantee an improvement in a credit score. Therefore, consistently paying bills on time stands out as the most direct and effective method for a borrower wishing to enhance their credit score.