When you use credit cards, borrow money for a car, or a home, or any other reason, you create credit. How you use that money or pay back those loans have long range effects on your ability to obtain loans, get new credit cards, and even the rates and ability to obtain insurance on homes and autos. It is important that you take care of the loans, don't let them get out of control or above your means. That is pretty simple and straight forward, things most people know. What you may not know is how your credit rating is effected by things people don't tell you. Have you ever been approached by the clerk at a department store to open a credit account at their store and save 10% or more on all your purchases that day. It is easy, only takes a few minutes, and if you don't want the credit card, simply pay the entire amount when the bill comes and cancel the card. Sounds great, doesn't it. What they don't tell you is that the number of credit cards you have effects your credit score. Too many cards, score goes down. Open new accounts (credit inquiries), score goes down. Close accounts, even if you do it, score goes down. Accounts opened and closed too quickly, score goes down. So, what is the result of your credit score being low? Well, first of all, if you want a loan, the rates you pay will be higher. You may or may not qualify for a loan, or because the rates may be higher, you may not qualify for enough of a loan to complete the purchase. Lets say you do not want a loan, or at least not now. Do you know that the rates you pay for your insurance, auto, home, renter's insurance .... are based on your credit score? Just because you opened and closed that credit card account to save 10% on the purchase, you now have to pay higher insurance rates, and for how long? Until your credit score goes back up. How long is that? I don't know the answer to that one. Do you know that each time you receive a junk mail invitation for a new credit card, that company probably did a credit check before they sent it out, or they bought a list from someone who did a bulk credit check ... called a soft check. Even those effect your credit score. Every time there is an inquiry on your credit, if there are too many, your credit score can be effected. Wow, that hurts, doesn't it. You don't even know about it, and wham, you have been effected. For your own sake, go to this web site and opt out of all of those unneeded, unwanted inquiries. http://www.optoutprescreen.com Just this one simple thing can increase your credit score by 10 to 15 points. I highly suggest that you go on the internet and do some searching about credit score problems and how to correct them. I think you will be amazed.