How to Repair Your Bad Credit File

Checking your credit score may reveal a low rating, and having a low rating makes it increasingly difficult to get approved for a mortgage or vehicle loan. Bad credit often results from poor budgeting and money habits. However, changing your spending habits and learning the ins and outs of credit scoring helps you improve a bad credit file and get the financing you need.

Instructions

1

Make larger payments to help pay off credit cards. Reduce credit card balances sooner with larger monthly payments. Pay more than the minimum and resolve to double or triple payments. If you owe $1,000, review your finances to see if you can make monthly $200 payments and pay off the debt in five to six months.

2

Stop applying for new credit cards and other types of credit. Too many credit inquiries are dangerous because they reduce your credit score. Shred preapproved credit card offers and only complete credit applications if necessary.

3

Discuss a debt settlement to pay off old delinquent account balances. Work to get old collection accounts deleted from your credit report. Take the initiative to locate old creditors and negotiate a payoff amount or debt settlement. Petition the creditor to update your credit report and report the debt as paid to help fix your credit file.

4

Fix a poor payment history. Build a better credit score with prompt monthly payments. A routine of late payments leaves a negative mark on your credit file. Break bad habits and start paying bills on time every month.