Overcoming Bad Credit

Five steps to overcoming bad credit.

So you’ve got bad credit? Don’t worry. It’s not the end of the world. Bad things happen to good people and bad credit can be repaired. Armed with a little knowledge, patience and time, you’ll be able to overcome your bad credit and will be well on the way to credit recovery. Follow these simple steps and you’ll be able to repair your bad credit.

Step 1 -- Order Your Credit Report

The first step towards repairing bad credit is to get a copy of your credit report. In order to repair your credit, you’re going to need to know exactly what’s on your credit report and what needs to be fixed.

Step 2 -- Dispute Incorrect Information

Oftentimes there is incorrect information on a credit report. Getting a copy of your credit report will enable you to see whether there is information on your credit report that needs to be disputed. If there is, you will want to get that information taken care of first as that can be contributing to your bad credit, and without reason.

Step 3 -- Pay off Outstanding Judgements and Debts

Next, you’re going to want to review your credit report for any outstanding judgements and debts. If there are outstanding judgements and debts on your credit report, you’re going to want to pay those off as quickly as possible. Outstanding judgements and debts can really contribute to bad credit, so getting those out of the way is vitally important.

Step 4 -- Establish Credit

Once you have your outstanding judgements and debts paid off, it’s time to establish credit. That means opening up a credit card account. If you can’t qualify for a bad credit credit card, then you’re going to want to apply for a secured credit card. A credit card will enable you to rebuild your credit, just make sure you use the credit card responsibly.

Step 5 -- Pay Your Bills on Time

Once you begin to reestablish your credit, you’re going to want to make sure that you pay your bills on time each and every month. Each missed payment is a ding on your credit report and will contribute to bad credit, so it’s important that you always pay each and every bill on time.

By following these five simple steps, you’ll be well on your way to ridding yourself of bad credit in no time.

Comments

I have a question. Do you at all recommend bankruptcy chaper 7? Or any bankruptcy at all?

With the Bad Credit Market becoming more and more competitive with each

passing day, the potential customer should have little problem finding

very competitive rates and fees. Its just a matter or knowing your credit

score and shopping around.

Self-discipline is the key in improving credit score.

Don't forget to not close old accounts. Keeping them open can increase your score.

In response to the first commentor, the answer depends on your personal situation. There are a few ways to avoid bankruptcy. Debt consolidation is probably the most popular method nowadays. In addition, the new bankruptcy law that went into effect in 2006, makes it more difficult to file.

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