Bad Credit History and How to Get Rid of It
Advertising Disclosure is an independent, advertising-supported web site. receives compensation from many credit card issuers whose offers appear on our site. Compensation from our advertising partners impacts how and where their products appear on our site, including, for example, the order in which they may appear within review lists. has not reviewed all available credit card offers in the marketplace.
Credit Card Applications » Research » Guides » Building Credit History » Bad Credit History and How to Get Rid of It

Bad Credit History and How to Get Rid of It

Updated: December 26, 2012

Add to Favorites:
There are many people who take their credit score seriously. If you are one of those people who have a bad credit score or a massive outstanding balance on your credit card, you are in for trouble unless you decide to improve upon the credit score right now. Motivation to not let the situation slip through your fingers and crystal clear planning and implementation will keep you in good stead. Why Worry about the Credit History? You need a house mortgage loan. If the credit score you have is 100 points less than that of your colleague's you can easily end up paying 5 - 10% more interest for the same loan, even though both of you are from the same office or have the same earning capability. Why should you choose to pay extra when you can get the same interest rate just by improving your credit score? Go to a credit card company, a hotel booking, an entrepreneurial loan or any other place and you will find that people look at your credit score even before they start talking to you. The lower your credit score, the lower is your creditworthiness and hence less lenders will trust you with their money. Even if they do, you will be slapped with ridiculously high interest rates. How did Credit History go Bad? Credit history is everything that you have done in the past. Your bank accounts, your debts, loans, spending, outstanding balance, the loans defaulted, monthly payments missed, number of accounts held etc. So, if you miss paying the monthly payment once, it reflects poorly upon your credit score. Your score suffers terribly, if you have repeated outstanding balances on your credit report too. If you fall back on mortgage payment, your score suffers further. How to Improve Credit history? Improving credit history doesn't happen overnight. But it can be done with planning and resolve. The first thing to do would be paying back the debt on your credit cards as soon as possible. Some banks offer balance transfer, but if you can manage paying off individually it is better, because balance transfer may lower your credit, unless the terms you get are really good like 0% interest for a whole year, which will help you pay back the credit faster. You should shop as less as possible with the credit cards to ensure your debt comes down gradually. You show consistency with your monthly payments. Apart from these normal things that you should follow sincerely, you can also try to protest for certain charges that have come on your name without your fault. The monthly payment miss because of their mistake or misreporting, the wrong balances or the late update of the credit card reports etc. could all be challenged. There are companies which specialize in that and you can take their help to get as many negative things off your credit card as possible. By doing all this, you are slowly cleaning your credit history.

Add to Favorites:
Get the latest news, articles and expert advice delivered to your inbox. It's FREE.

Related Research:

5 Reasons to Get the Capital One Venture Miles Rewards Card

By Herbert Moore, Posted: January 18, 2017

If you’re looking for a great travel rewards credit card—one that offers unlimited earning opportunities, flexible redemption, and lots of perks—look no further. This card from Capital One has you covered. Continue reading

Credit Card Tips For Holiday Shopping 2016

By Herbert Moore, Posted: November 23, 2016

November and December are the busiest months as gift shopping reaches its peak. People rush around looking for the best gifts and the best deals leaving a lot of money in the shops. Holiday season may force you to go over the household ... Continue reading

Credit Cards to Save More on Holiday Shopping

By Herbert Moore, Posted: November 22, 2016

Discounts and special offers are available all year round. Werther you are a bargain hunter or an impulse buyer, make sure you check online discounts and special offers. Also, if you are a cardholder, see if your credit card opens the door ... Continue reading