1. Examine your credit report
Finding ways to get your credit score up will be hard. But the first thing you have to do is to find out exactly what you need to improve. Your credit report will have a specific list of the accounts that are draining your credit score dry. Each of the three major credit bureaus will have a different copy of your credit report so it is best to get one from each and find out what you need to work on. AnnualCreditReport.com provides a free credit report online.
2. Credit report errors
Check your credit report for any errors that might be adversely affecting your rating. The right to make the credit bureaus aware of these errors and the right to have them removed is totally yours. You can send a registered letter to the credit bureau that published the error or to the creditor that reported the erroneous information and have them reverse the charges. Even small errors can hurt your credit score in a big way.
3. New credit card purchases.
If you’re trying to build up your credit score, new credit card purchases should be a no-no. New purchases will raise the ratio between your balance and your limit and the higher your balance is, the more your credit score is lowered. So, as much as possible, pay cash for any purchases you need to make for the time being. If you can avoid the purchase completely, especially if it’s not really a necessity, it would be that much better. Instead use the money to reduce your credit card balance to improve your credit score.
4. Past dues.
Your payment history is an integral part of your credit score. If you are behind on any of your payments, your credit score suffers. Get caught up on your credit card payments when you have extra money. If they are charged-off or sent to a collection agency, your credit score goes down the drain.
5. No new credit cards.
While you’re repairing your credit avoid taking out new applications for credit because each credit inquiry you make can hurt your credit score. A new credit account also effectively lowers your credit, which also hurts your credit score.
6. Keep accounts open.
Delinquent credit card accounts are usually closed out to help keep the interest from accruing even more. But, before you close any account, you should make sure your credit won’t be adversely affected. Closing a credit card with a balance usually prompts the lender to also stop reporting your credit limit which can then hurt your credit score. It is actually very rare that closing down a credit card account will result in an improvement to your credit score.
7. Contact your creditors.
Your creditors are probably the last people you’d want to talk to regarding fixing your credit score, but many of them can actually help you. Most lenders nowadays have temporary hardship programs that can help reduce your monthly payments so that you can get back on your feet and find surer financial footing.
8. Pay off debts.
The amount of debt you’re carrying is a large blight on your credit score. Paying off these debts will improve your credit situation. Sell off some of your better belongings to get the cash needed to pay if you have to. Sacrifices are necessary to gain the financial freedom everyone is craving.
9. Get help.
Consumer credit counseling is a professional service that is available to you so that you won’t feel overwhelmed by your debt situation. Sometimes, the best way to survive a difficult situation is to find the right kind of help and support.
10. Patience and Persistence.
Your credit score doesn’t factor in the amount of patience you have but it’s something you sorely need to have while your credit is being repaired. Your credit cannot be repaired overnight so you need to persist in your efforts to improve it. Continue paying your debts on time each month and, slowly but surely, you will start to see a better credit score.