How do I Help Rebuild Bad Credit Scores?

When reviewing your credit to see if you're eligible for financing, lenders obtain your credit score from one of the three bureaus: Experian, TransUnion or Equifax. Maintaining a good credit score helps you get approved for loans and credit cards. On the other hand, a low score can trigger a loan denial or a higher interest rate on loans. There are methods to rebuild your credit scores and become a prime applicant for a loan.

Instructions

1

Pay your bills online. Because late payments damage your credit rating, use online payment systems and submit payments before the due date. Enrollment is free, and payments are often credited to your account on the same day.

2

Pay off credit card debt. Raise your low credit score by paying down your credit card balances or paying off the card completely.

3

Rebuild with a secured credit card. Apply for a secured credit card if you can't qualify for an unsecured major credit card. Banks offer these accounts to people with credit problems. Visit your local bank and request an application. Inquire about security deposits and setup fees for the account. Consistent on-time payments help raise a credit score.

4

Make a plan to pay off old debts. Collection and judgment accounts on your credit reports can contribute to a bad credit score. Negotiate with old creditors to eliminate these debts. Send weekly or monthly payments to pay the full balance, or negotiate a debt settlement. Ask the creditor to update your credit report and remove the delinquent account to help improve your credit rating.