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In a nutshell
If you’ve made some mistakes and wound up with a low credit score, you can take some simple steps that may improve it including:
- Checking your credit report and disputing any errors.
- Improving your credit utilization ratio.
- Lengthening your credit history.
Step 1: Get a copy of your credit report
By law, you’re entitled to a free copy of your credit report every 12 months from each of the three major credit reporting agencies: Equifax, Experian and TransUnion. You can request these reports through the website AnnualCreditReport.com.
You can also get reports from services like myFICO or CreditKarma, which may offer free credit-related services and premium upgrades that give you more insight into your credit profile.
Nowadays, you can also get access to your credit report through many credit card issuers and banks. With many of these services, you can see information on your credit report for free, but you may have to pay extra to get access to your actual credit score.
| Brand | Fees |
|---|---|
 | $0 - $24.99 |
 | $0 - $39.95 |
Step 2: Review your credit report for any inaccuracies
Once you receive your reports, review them for any errors. There are many common errors you may find, including:
- Incorrect personal information like addresses, aliases or Social Security numbers.
- Accounts that don’t belong to you.
- Misreported payment statuses.
- Payments incorrectly reported as late.
- Incorrect account balances.
- Old information that should have been removed.
Make notes on any inaccuracies because you’ll need these in the next step.
Step 3: Dispute errors on your report with the credit bureaus
Once you have a list of errors and incorrect information on your credit report, it’s time to dispute these errors directly with the credit bureaus.
To do this efficiently, it’s best to create an account with all three credit bureaus and initiate the dispute process online. Once logged into your account, you should see the option to dispute items on your report. You should also be able to submit a request to update your personal information as needed.
Some people prefer to dispute items via mail. You can use the dispute forms provided by each company, or you can write a letter “from scratch” explaining why and how your information should be updated or corrected. In either scenario, you must also send supporting documentation that can help your case, such as bank statements or payment confirmations.
Send this information to the credit bureau, either online or by mail, and wait for them to investigate. The bureau typically has 30 days to investigate and respond to your dispute. If the bureau agrees that an error has occurred, it will correct the error on your credit report, which may positively impact your credit score.
Step 4: Pay down existing debt to improve your credit utilization ratio
Your credit utilization ratio is a major factor in your credit score, representing the amount of credit you're using relative to your total credit limit across all accounts. A high utilization ratio can signal to lenders that you're overextended and may have difficulty managing additional debt, negatively affecting your credit score.
To improve this ratio, focus on paying down outstanding balances, particularly on revolving accounts like credit cards. Aim for a utilization ratio of 30% or lower, as this is typically considered favorable by most credit scoring models. By reducing the balances you are carrying, you may see an improvement in your credit score.
Step 5: Increase the length of your credit history
Though not as important as your payment history or utilization ratio, the ages of your accounts, whether open or closed, play an important role when it comes to calculating your credit score. The longer you’ve had credit, the more experience you’ve had with debt management, which is proof to the credit bureaus that you should have a higher credit score.
Additionally, becoming an authorized user on a trusted family member or friend's credit card can also improve your score. This method allows you to benefit from their positive payment history and older accounts. In some cases, it can even decrease your utilization ratio (and increase your credit score) if the balance is low enough.
Be aware, however, that this strategy only works if the card issuer will report the account to the credit bureaus.
Step 6: Limit new credit applications to avoid hard inquiries
Every time you apply for a new line of credit, lenders make a “hard inquiry" into your credit history. These inquiries can temporarily lower your credit score by a few points.
If there are too many inquiries within a short period, it can signal to lenders that you may be a high-risk borrower, potentially leading to rejections on future credit applications. If possible, apply for new credit sparingly, especially when rebuilding your credit score.
Step 7: Pay bills on time to build a positive payment history
Consistently paying your bills on time is one of the best ways to maintain and improve your credit score. Late or missed payments can severely impact your credit score, as payment history accounts for a significant portion of credit scoring models.
Consider setting up autopay or calendar reminders to ensure you never miss a due date. This demonstrates to lenders that you are a reliable borrower, which can boost your credit score and help you access favorable terms on future loans or credit applications.
When possible, add rent, utility or subscription payments to your credit report so that more positive information is reported to the credit bureau. Services like Experian Boost can help you do this.
Step 8: Consider a secured credit card or credit builder loan
You can rebuild your credit with a secured credit card or credit-building loan. Unlike traditional credit cards, secured cards require a cash deposit that serves as your credit limit, which reduces the risk of delinquency or default. This makes it easier to get approved even with a low credit score.
Additionally, many issuers allow you to upgrade to an unsecured card after a period of consistent, responsible use. For instance, the card_name is known for granting automatic upgrades after a few months of responsible use. By using a secured credit card responsibly by keeping balances low and making payments on time, you can demonstrate creditworthiness and gradually improve your credit score.
Similarly, credit-building loans hold the amount borrowed in a bank account while you make payments. When you pay off the loan successfully, you’ll get your money back, plus you’ll gain a record of on-time payments.
Step 9: Regularly monitor your credit report and score
Keep a close eye on your credit score to track your financial progress and identify any potential issues early on. Regular monitoring can alert you to any unexpected changes that may indicate fraudulent activity or errors on your report. You can choose from a number of free and paid services to help you monitor your credit information.
Step 10: Be patient
Be patient, because rebuilding your credit takes time and discipline. The process of rebuilding credit is not instant and requires consistent effort and patience.
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Improving your credit score will take time and energy, but it could be well worth it to get better loan terms, which can save you money down the road. Staying disciplined with your financial habits, such as paying bills on time and managing debt wisely, will boost your credit score over the long term and ensure you’re in a better overall financial position.
Frequently asked questions (FAQs)
Can you fix a ruined credit score?
Yes, a lower credit score can be improved over time by consistently managing debts responsibly, making timely payments, and following credit repair strategies.
How long does it take to fix a bad credit score?
The time it takes to fix a bad credit score varies depending on the severity of the issues and how quickly you take action. Typically, minor issues can be improved within a few months, while major issues like bankruptcies or foreclosures may take up to 7-10 years.
Is it true that after 7 years, your credit is clear?
It takes 7 years for negative items to fall off your report. It can vary, but repairing a bad credit score typically takes anywhere from 3 to 6 years, sometimes less with some diligence and consistent effort.
AP Buyline’s content is created independently of The Associated Press newsroom. Our evaluations and opinions are not influenced by our advertising relationships, but we might earn commissions from our partners’ links in this content. Learn more about our policies and terms here.
