There are a couple of reasons for this. You can pay your bills on time for years and never gain more than a few points on your credit score.

As you probably already know, paying minimums on credit cards and bank loans do not lower your principle amount very quickly. When your balance is too close to your credit limit on a card, it actually hurts your score, even though you may be paying your bills every month without fail.

Paying the minimum can actually hurt you in some cases, especially on cards with high balances. Banks like to see plenty of breathing room on your credit cards. You are more creditworthy to them if you have plenty of availability on your cards.

Another reason you may be denied credit is your debt-to- income ratio. If your total debt is too close to your total income, Banks will not extend you credit. I struggled with these issues for years until i figured out what i was doing wrong. Every time i would lower my balances, I would run right out and build them back up.

By paying down your balances and making smaller purchases on your cards, you can raise your score significantly in just a few months. Only buy on credit what you can pay off at bill time. Buy something and pay it off... Buy something and pay it off... You get the idea. This will eventually get you higher limits and lower your rates, as well.

So, you can keep paying bills on time for eternity, but until you lower your balances and decrease your debt, you'll be stuck in credit score mediocrity.