Home foreclosures are up. So is unemployment. Your credit-card bills are mounting. You may hope to improve your credit score by cancelling all those credit cards. But hold on.

"Canceling your credit card can actually hurt your credit score because you give up the available credit on that card. And available, unused credit is one of the key components of your credit score," Consumer Reports' Greg Daugherty said.

In assessing your credit score, Scott Hannah of the BC Credit Counselling Society says credit rating agencies add up your total available credit and they like you to owe less than 50 per cent.

"On a credit risk score model when a person is utilizing more than 50 per cent of their outstanding credit limits it is cause for concern," Hannah said.

If you cancel unused cards and give up available credit you could go over the magic number of per cent and your score drops.

So to improve your credit score keep the cards, stop using them and pay down the balances.

"And once the balance is paid in full then close the account," Hannah added.

Second, be careful applying for loans. Too many loan applications in too short a time can hurt your score, especially if they are rejected.

"Apply for credit in person and ask the loan officer if you qualify before submitting a loan application. If you're going to be rejected, go elsewhere," Daugherty said.

Third, if you're drowning in unpaid bills, seeking debt relief is good.

"Contact creditors and work out an alternate repayment terms over the short period and it may be that you are going to have a reduced payment," Hannah said.

It will hurt your credit score temporarily until you bring your accounts up to date. If you stop making payments and it goes to collections it becomes a bad debt and that remains on your credit report for up to six year even if you pay it off

You can get your credit score for a fee from TransUnion Canada or Equifax and they'll also have advice on how to improve it. Remember no matter what your score is, always use credit wisely.

With a report from CTV British Columbia's Chris Olsen