- Analyze your credit report first. Obtain a free copy and check it for any errors. Make sure that your name, social security number, and address history is accurate. Look for items on your credit report that may not be yours. For example, if you have a parent or relative with a similar name, you may find items that are actually theirs on your credit report. Also, make sure there are no incorrect late payments listed. If there are errors on your report, you can dispute them by contacting the credit bureau and reporting agency.
- Establish payment schedules and reminders. One of the biggest factors in determining your credit score is simply how well you pay your bills on time. Those who pay their bills on time are rewarded with higher credit scores. You should consider enrolling in automatic bill payment plans, if possible. This way, you will not forget to pay a bill. You can also set payment reminders so that you do not miss a deadline.
- Reduce the amount of debt that you owe. If you have several open credit cards with balances, choose those that have the smallest balances and get them paid off as quickly as possible. Eliminate using these credit cards as well. You can also identify your credit cards with the highest interest and get those paid off. Reducing the amount of your debt takes time but will ultimately lead to a higher credit score.
- Open a new account and pay it off on time. Some credit scores are low just because a person doesn’t have a sufficient credit history. If this is the case, consider something like a car title loan. If you have a clear title for your vehicle, you can borrow against it. The loans are short term and your credit score is irrelevant. Repay the loan quickly and watch the positive impact that it has on your credit score.
These are just a few tips that one can follow to help repair a damaged credit history. In order to do so, one must be patient and diligent. In the end, having a higher credit score will be worth it.