How do I Improve Credit?

If you want to improve credit, there are several steps that you can take. While improving your credit does take time, you can begin to see an improvement in as little as a month. The worse your credit rating, the longer it will take to improve. Raising your credit score allows you to qualify for lower interest rates and insurance costs. Many employers also check the credit history of new applicants.

Before you begin the process to improve credit, it is important to know what you have to work with. Everyone is entitled to a free copy of their credit report from the three credit reporting agencies. Mistakes do happen, so request a copy of your credit report. Check the report carefully, and make sure that any unfavorable listings are legitimate.

If possible, pay any obligations that are listed on your credit report. They will not be removed from your credit report, but will be marked as paid. Time is the only thing that will completely remove them from your credit history.

The next step to improve credit is paying all of your existing bills on time. Even if you do not have a credit card, you should pay the obligations that you do have on time. While some utility bills and other companies do not send on time payment records to credit reporting agencies, nearly all will report late accounts.


Once you are paying all of your current obligations on time, you may want to consider getting a credit card. Only apply for a credit card if you are certain that you can use it responsibly. Pay the credit card balance in full, each month. If you do not, you will do little to improve credit.

If your credit is not too poor you may be able to get a fuel or department store credit card. These credit cards are often easier to get than a traditional Visa, MasterCard or American Express. If you cannot qualify for a store or fuel credit card, a secured credit card is another choice.

A secured credit card is a card that allows you deposit a specified amount of money into a special savings account. You cannot withdraw your money from this account as long as you have the secured credit card. A secured credit card works just like a traditional credit card, but the savings account acts as security for the credit card company. Many credit card companies will convert your secured card to an unsecured card after a specific amount of time, as long as your payments are made on time.



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