If you have bad credit, it may seem like it’s impossible to fix. But you should know that it’s actually very possible to improve your score by following a few simple steps. The key is to work on your credit-building and financial health over the long term. That means establishing a strong on-time payment history, taking steps to pay down debt and avoiding unnecessary charges. It can also be helpful to work with a professional credit counselor to help you identify the root causes of your problems and come up with a plan for how to address them.
Building a good credit score takes time, so you need to be patient and stay focused. It’s also a good idea to sign up for free credit monitoring so you can get real-time alerts when your score changes. This can keep you from falling back into bad habits that can undo all your hard work.
How long it takes to repair your credit depends on the items affecting it, but it generally takes months or even years. That’s because negative items can remain on your report for up to 10 years, while positive ones only stay for seven. However, there are some things you can do to speed up the process.
One is to dispute inaccurate information on your credit report with the credit bureaus, which is something you can do for free under the Fair Credit Reporting Act. This includes errors such as closed accounts showing as open, debts that appear multiple times and incorrect balances. You can use a tool such as Experian Boost, which helps you easily send a dispute letter to the credit bureaus.
Another way to make your credit score rise is to reduce your credit utilization rate, which makes up 30% of your credit score. You can do this by paying down debt, requesting a credit line increase on an existing card or getting a new card altogether. Just be sure to pay the minimum required amount each month to avoid a late fee and prevent the card issuer from reporting the account as delinquent on your credit reports.
The final thing to do is to build up positive information on your credit report, such as a history of on-time payments or a low credit utilization ratio. Credit cards are perfect for this because they can be used by anyone and they report to the credit bureaus on a monthly basis. But before you start shopping around for a credit card, check your credit report to see what’s already on there. And be very wary of any credit “repair” companies that make overblown claims or vow to remove accurate, but damaging, information from your credit report. how to fix my credit