how do I get my credit score to improve???

Question

My credit score is terrible, i have had my experian report and there is 6 defaults on there. They are all settled and read as satisfied! they were defaulted in 2003 and 2004. There is no outstanding balances anywhere. I have now been cleared for a year, but still can't obtain credit. It is such a headache. I just want to rebuild my credit, i am older and wiser now and need help. Any suggestions welcome.

Answer 1

You know the same thing happened to me -- I was young I made stupid money mistakes but I was lucky to make the right moves at the right time. I'm glad that you are being responsible now, but dont get too frustrated. Let me explain..

Old debts get written off and removed from your account after 7 years, which begins when the creditor first reports your account -- however some shady companies use whatever information or payments you send them to change the date of your account on your credit reports so that it prolongs the time it takes to get them written off -- this way they can have leverage over you which improves their chances of getting their money. Don't fret, you can easily write to any of the credit reporting agencies if this happens and have them remove inaccurate entries, but of course you have to continue to track your credit score and credit reports until they are completely cleaned up. It's funny but most people think that paying off charged-off accounts is going to help them, and really all it does is show lenders that you are responsible to pay even your late accounts.. however in the world of money timeliness is more important. Even if you pay your old collections such information is not removed until the 7-year time period ends and the fact that you paid late still negatively impacts your overall score no matter if you pay it off or not. So in some cases it may be better to just wait and do other things to boost your score while the other items expire.

Though there are things you can do... For example, it doesn't take long for short term changes like account balances, payments, and available credit to show up on your credit report and effect your score -- likely these are the things to have impact over the short term, and you have a better change of fixing your score if you try to address one of those issues, which you can do easily in a matter of weeks.

You might start off with a secure credit card to demonstrate you're better with your debt now =)

Building your score is important so here are my 10 steps you can use to build your credit score quickly. I raised mine to well over 700 points fro 500 using these steps in less than a year:

1. Know and Track Your Credit Score (be sure to sign up for the free trial of your credit score monitoring listed on the article below. It really helped my get my score up.)
2. Never Miss a Payment, Starting Today
3. Never use more than 20% of your Available Credit
4. Keep Credit Cards that Have No Annual Fees Open For as Long as Possible
5. Extend Your Credit Limit on Cards You Already Have before You Get New Ones
6. Get Credit Cards that Have CashBack Rewards to Contribute to your Balance
7. Transfer Your Balance to a Credit Card with a Lower Interest Rate and a Higher Available Credit-
8. If You Think You Are Going to be FORCED to Pay a Bill Late Ask for an Extension or Payment Plan
9. Take out a Small Personal Loan and Repay it Over a Year
10. Ask Someone With Good Credit if They will Account Shadow you

Remember though, when you're trying to build a solid credit score it's important to get a comprehensive view of what is actually effecting it...

Your Credit Score (also known as your MyFico score) is calculated with the following breakdown:

* 35% -> History of Payments
* 30% -> Debt to Credit Ratio (available credit)
* 15% -> Credit History (length of open accounts)
* 10% -> New Credit (are you expanding your credit)
* 10% -> Credit Types in Use (varied credit types from loans to credit cards)

If you excel in one area and lack in another, only fixing the areas which you lack are going to improve your score.

You can read more about these tips on my blog: How Can I Increase My Credit Score

* http://millionster.com/articles/debt/increase-fico-credit-score/

I really do wish you the best of luck. I hope my answer helped you be all the wiser =)

Answer 2

Too much revolving debt can hurt your credit score. Another option would be a small CD secured bank loan. If you can find a bank that has no minimum loan amount, then take whatever amount you can afford and open a bank CD. Most banks will loan against their own CD's no matter what your credit history might be because it is considered a cash secured loan. Not to mention that the interest rate will be MUCH lower than on a credit card. Put the borrowed money into an account and set up an automatic payment from that account to the loan. Then all you will have to worry about paying is what ever interest has accrued. Hope that makes sense!

Answer 3

The negatives are going to stay for 7 years. However, as they get older they will have less impact on your score.

Do you have any credit cards now? You might consider a secured card -- you put up a deposit as collateral. Use it and pay it off in full every month.

You need at least a 2 year consistent on time credit history to get a decent credit score.

Answer 4

If the charge offs are satisfied you can write to the credit bureaus and ask them to be removed.

Are you paying all of your bills ON TIME? Even one day late can raise you interest rate and lower your score.

If you have trouble getting this done you may need to call a reputable credit repair agency. (Do your homework and interview several companies)

There are many other ways to "improve credit" feel free to email me if you would like.

Best wishes!

Answer 5

Secured credit cards are a great way to rebuild your credit. Most secured credit card companies require a deposit equal to the credit line your are seeking. Make sure they report your payment monthly to the major credit bureaus. Making your payments on time monthly will increase your credit rating. You will also get you deposit returned to you after one year, turning your secured credit card into a unsecured credit card.