Tips to improve a bad credit history

ADVERTISING DISCLOSURE

ADVERTISING DISCLOSURE:
Credit-Land.com is an independent, advertising-supported web site. Credit-Land.com receives compensation from most 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. Credit-Land.com has not reviewed all available credit card offers in the marketplace.

Credit Card Applications » Research » Guides » Building Credit History » Tips to improve a bad credit history

Tips to improve a bad credit history


Updated: December 26, 2012

The content is accurate at the time of publication and is subject to change.

Having a bad credit history can be a huge burden for anyone wishing to lead a normal lifestyle. Improving the said credit record is not only about keeping expenses low or paying all your bills on time every time. There is much more to it than that. In order to rectify a bad credit history to make it fair or even good, you need to dig into the history and find out why it went bad. After you find out what went wrong, you can set about rectifying the problem.

Firstly, you need to check your credit limit to find if it was reported correctly. Credit reports are generally an indicator of your financial credibility. They will tell you if something is wrong with your financial history. It is important to get regular reports from the credit reporting bureaus in order to find out your score, and if there is anything wrong. For example, the credit limit that is reported by the lender may be a lot lesser than what it actually is. There might also be erroneous negatives like late payments, missed payments, defaults or bankruptcy on your report. This can be accidental or true. In any case, you need to take steps to resolve the situation.

Secondly you need to find out how much credit you have applied for. If you keep applying for credit cards impulsively and are chasing credit card rewards, then you will find that it is affects your credit history. The more credit you seek, the more it will affect you. The more people ask for your report, the credit score will get lower. It is best to use an old credit card without chasing new rewards and introductory benefits that make no sense. Keep your credit lines low, but at the same time ensure that you do not stop using credit altogether.

Thirdly, are you using balance transfers? Balance transfers can affect your credit score adversely. In the long run, it is a good step if you have planned your moves, but its immediate affect will be to reduce your credit score. Even debt consolidation loans can affect you negatively. This is because your credit limit will be reduced and this will lower your credit rating. Having a smaller balance on many credit cards is much better than having one high balance on a single credit card.

These are questions that you must ask yourself before you go about trying to improve your credit history. There are many negatives that can be removed if you talk to your lender and try to sort it out.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
Add to Favorites:
Get the latest news, articles and expert advice delivered to your inbox. It's FREE.

Related Research:

Autumn 2018: Best Rewards Credit Cards for Thanksgiving Shopping

Autumn 2018: Best Rewards Credit Cards for Thanksgiving Shopping

Posted: November 8, 2018

Thanksgiving is coming, and whether you are hosting a meal or coming as a guest, your spendings are going to accumulate faster than you can notice. A holiday feast is a costly matter – each year Americans spend around $50 on a Thanksgiving ... Continue reading
The Best Credit Card for Earning Cash: Discover it® Cash Back

The Best Credit Card for Earning Cash: Discover it® Cash Back

Posted: November 2, 2018

You’ll have hundreds of dollars in your pocket in no time because you’ll earn money back on every purchase you make with this card. There are no restrictions on the amount of cash back you can get, and Discover even matches every penny you ... Continue reading
Top 5 Cards for Travel from Our Partners: Autumn 2018 – Expert’s Choice

Top 5 Cards for Travel from Our Partners: Autumn 2018 – Expert’s Choice

Posted: October 10, 2018

Nights are drawing out, the wind is colder every day and you already feel the lightest breath of winter on your face - autumn is here. Holidays are over, kids are back to school and all you are left with are hefty holiday bills that you ... Continue reading
You've successfully subscribed!

Please specify the following:All these fields are optional

Your Credit History
Themes you are interested in:

By providing this information you help us make our news letters more useful and informative. Thank you!