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Get Out of the Red: 5 Must-Know Strategies for Fixing Bad Credit

Poor credit score report with pen and keyboard

Close to half of all employers check potential employees’ credit scores when considering hiring them. Is your credit score a cause for concern?

If you’ve found yourself in a situation where you’re wondering how to repair your credit, do not despair. Fixing credit is possible.

Are you ready to turn your credit around? If so, read on for 5 critical strategies for fixing bad credit and getting yourself out of the red.

Fixing Bad Credit: 5 Strategies That Will Help

If your credit score is dipping below 500, it’s time to repair your bad credit. Getting a loan, a job, insurance or renting an apartment, etc. requires a good credit score. Without credit repair, things will be more difficult and more expensive. Find out more here. When looking for answers to the question, “How to fix my credit?”, look no further.

1. Understand Your Credit Reports

There are three credit bureaus (Experian, TransUnion, and Equifax) that issue credit reports. Each one is required to give you a free full report annually. You can get the reports by calling 1-877-322-8228 or by visiting www.annualcreditreport.com.

Review the reports and check that all information is accurate. Any errors should be reported and backed up with proof. You can dispute falsehoods right online in most cases.

Phone numbers and web sites for the three credit bureaus:

  • Equifax: 800-685-1111 – www.equifax.com
  • Experian: 1-888-397-3742 – www.experian.com
  • TransUnion: 1-800-916-8800 – www.transunion.com

2. Stop Spending More Than You Make

Once any errors have been fixed, it’s time to take control of your spending. Make a budget and stick to it.

Pay all of your monthly bills and pay down your debt with any money you have left. Break the habit of using credit cards to buy things you can’t afford.

3. Pay Your Bills On Time!

Late payments stay on your credit report for a long time. You can’t do much about that after the fact, but as you are trying to repair bad credit it is imperative to pay all of your bills on time.

If you find yourself unable to pay one of your bills on time, be smart about which one you pay late. Choose the one least likely to report it to the credit bureaus.

4. Keep Your Oldest Credit Cards

The length of your credit history has an impact on your credit score. Keeping the credit card or cards you’ve had the longest will increase your overall credit history.

If you decide to close some of your credit cards, close the ones you’ve had the least amount of time.

5. Increase Credit Limits

This might sound counterintuitive, but if your ratio of available credit to credit used is smaller than 50%, it will a more positive impact on your credit score.

You never want to max out your credit cards and you want to try to keep your balance lower than 50% of your available credit.

The Path to Credit Repair

Now that you’ve learned some of the important steps to fixing bad credit, you can be on your way to a better credit score. A better credit score will put you on a path to financial freedom. Visit us for advice on investments and other financial topics to help you get on your feet again.

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