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The reasons for not having a good credit history can be numerous. It cannot be pointed out as just one fault that you made. It is a lifestyle problem when you look into the source of the issue. But when you start looking into the various layers that make up this problem, you can go about solving each one of them step by step.
The most important and common issue that people face is credit card default. This happens to a lot of us. It may be unintentional or it could be that you do not have the money to pay the balance. Credit card companies give you a certain limit up to which you can use your card. When you make a transaction on your credit card, you will have a month or so which is called the grace period, to pay the balance. If you do not pay the balance by the end of the month, you will have to pay interest on the money borrowed. This interest will be more than that of a conventional loan and it could go up to even 20%. It is always prudent to pay your balance in full by the end of the grace period. If you do not, you will have to pay a minimum amount every month, failure to do so can adversely affect your credit history. Even having a huge outstanding balance can affect your credit history.
Taking conventional loans and defaulting on them can also affect your credit history. Even if the loan was secured and the secured item was seized, you will find that your credit history has suffered. Hence, it is important to inquire with the lending agency and negotiate for a small amount so that it does not go to collection.
Paying your utility, cell phone bills, and insurance premiums on time are also important, anything that is linked to your social security can and will reflect on your credit history. Take control of the situation and apply for a loan or debt consolidation loan to sort out the problem. This is the only way to get out of the vicious circle of debt unless you have a rich uncle who can pull you out of the mess that you have gotten yourself into.