How to Rebuild One's Credit Fast

Problems managing credit are reflected on your credit report, which determines your credit score. Having a bad credit score can make it difficult for you to obtain credit. Unfortunately, there is no guaranteed way to rebuild your credit right away. The time it takes depends on what sorts of credit problems you have had and whether you are in the financial position to fix them. There are a few ways you might be able to boost your credit score significantly within a month or two, but otherwise, rebuilding your credit will take time.

Instructions

1

Obtain copies of all three of your credit reports by visiting the Annual Credit Report website for free copies of the reports. You are legally entitled to only one free report per bureau per year. Therefore, if you have gotten your reports from the site in the past year, you will have to buy your reports instead by visiting the Experian, TransUnion and Equifax websites.

2

Look at every negative item on your credit report and file a dispute with each credit bureau for the items that do not belong to you. These might be collection accounts you don't recognize, public records that are not yours or late payments reported when you paid on time. The process for the disputes varies slightly among bureaus, but all of them provide instructions printed on the credit report.

3

Write a letter to any creditor that has listed just one late payment. Ask for a "goodwill adjustment" to remove that late payment from your credit report. This will boost your score because you won't see the negative effects of that late payment anymore.

4

Write to any creditors with which you are currently late on your payments. Explain that you have been suffering financial difficulties but are getting back on your feet and would like to start making payments again. Ask if your account can be re-aged. In this process, the creditor will delete the late payment notice from your credit report, usually after you make three on-time payments in a row.

5

Lower your utilization on your credit cards. The utilization is the ratio of the balance to the credit limit. High utilization, especially if the balance is at or very close to the limit, hurts your credit. The two ways to lower your utilization are to pay down your balance or to increase your credit limit by calling the credit card company and asking for a higher limit. For example, if you have a balance of $5,218 and a credit limit of $9,000, your utilization is $5,218/$9,000, or 58 percent. If you pay your balance down to $2,218, your utilization suddenly drops to $2,218/$9,000, or 25 percent, which should boost your credit score.

6

Ask someone with excellent credit to add you as an authorized user on one of his credit cards. The positive account history will appear on your credit report as well, boosting your score. This move will only affect the other person's credit if you use the card to make purchases, which will increase the credit utilization ratio for both of you on that card.

7

Get a credit card if you do not currently have one. If your credit accounts were closed due to bankruptcy or debt management, you will want to start using one to rebuild your credit. A secured credit card, which requires a deposit, is the easiest type to get. Your score will drop slightly when you apply for and get the new card, but using the card lightly and making payments on-time will begin rebuilding your credit over the coming year.