Bad Credit? No Problem! (Guest Post)

by Five Fantastic Lawyers™ on August 25, 2012

Debt Slave Vector Illustration

(Guest post which may be helpful if you live in the US) If you’re like many Americans that have been hit by the downturn in the economy, your credit score may have taken a hit. For many people, survival today means skipping the credit card payments in order to keep the lights on. If you’ve recently gotten back on your feet, or see the light at the end of the tunnel, you can start to return your credit to good standing faster than you think. Here are five ways to improve your credit score on your own:

1. Dispute Errors

You are entitled to a free copy of your credit report once a year or each time you are turned down for some type of credit. If you haven’t taken advantage of this, now is the time to do so. Pull your credit report and look it over for errors. Look for closed accounts that are older than seven years, any mistakes with your Social Security number, name or address, and any payments that have been reported incorrectly. If you find errors, open a dispute with the credit bureaus.

2. Keep Accounts Open

Many people make the mistake of closing accounts that are no longer in use. If you have accounts that you’ve been faithful about paying, keep them open. Part of your FICO score calculation includes the length of your credit history. Closing multiple accounts will shorten your history and lower your score.

3. Use the Snowball Effect

Instead of making the minimum payment on each credit card that you have, concentrate your efforts on paying off one. When that card is paid in full, begin making payments on another. If your credit score is already ruined, skipping payments on a few cards in order to pay off one isn’t going to make your score worse. In fact, if you make only the minimum monthly payments, you will be paying your cards off for years.

4. Get a Secured Loan

Getting a secured loan is a great way to rebuild your credit score, providing that you make your payments on time. Make sure the loan is small so that you know you will be able to repay it. When you make your payments on time, the bank will report your responsible behavior to the credit unions, and you will see your credit score begin to go up.

5. Work with Your Lenders

Don’t wait for your accounts to go to collections. If you are behind, or are in danger of falling behind, contact your lenders and work out a payment plan. Your credit score won’t take as hard of a hit if you pay your lenders directly rather than allowing your accounts to be closed for collections.

You can rebuild your credit score if you follow the proper steps. Your score won’t rise overnight, but it will slowly creep back up to an acceptable number. If your credit has been ruined, take steps today to start repairing the damage.

Judith Page is a freelance blogger who writes about ways to improve your credit score. You can start repairing your credit today with a secured loan, which you can apply for at

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