Many people in our society struggle with credit card problems. Many people don't know they have poor credit until they are turned down for a loan and they are shocked to learn their credit is as bad as it is.

To the credit card industry, consumers are nothing more than a number. Anyone with anything bad on their credit report will be considered high risk and will be denied credit by several companies. Those who are considered high risk are those who are in the category of late payments, recent delinquencies, and are carrying more than 30% of the total credit limit on each credit card.

Several lenders have now developed services and products that are geared towards higher risk customers. Thos with credit issues will be able to obtain credit for a lower credit limit and for a higher interest rate. Some companies will also lend you the money for a larger down payment, higher premiums, or less attractive terms.

You may be one of those consumers who may still be turned down for a loan because your credit is in such poor shape. Anyone who has recently filed for bankruptcy will have a hard time obtaining credit. A few lenders have policies in place that states they will not do business with anyone who has had negative accounts with their company in the past. This basically means that if you obtained credit from a lender 10 years ago and you declared bankruptcy or you had frequent delinquencies, they have the right to deny you credit even though you are now demonstrating an ability to pay for your debts.

Far too often consumers are told they can obtain credit from certain lenders who are willing to help them with their credit issues. The marketing strategies by these companies trick consumers into thinking they can obtain credit no matter how bad their score is. This is unfortunately not the case, you can damage your credit so badly that no one will offer you credit, even those companies who claim they will grant you credit no matter how bad your score is.

So how do you know how bad your credit score is? There are several companies who will allow you access your credit report for free or for a small payment. Everyone is entitled to obtain a free copy if all 3 of their credit reports once a year. It is important to know just how bad your credit is so you can take steps toward repairing it before you get too far into the high risk category.

Clark Howard's 30 month program will show you the progress you are making in paying down your debt balances and putting yourself under a firm timeline to pay off your credit card debt. Howard's program is similar to a car loan; you set yourself up on a firm timeline and agree to pay it all off by a certain date.

Other ways to re-establish your credit.
Open a savings account, this shows creditors that you are willing to save and you have a reserve to pay your debts. As you work toward building a solid credit history, you have a few several options to look at. Secured credit cards are one way to re-build your credit. Secured credit cards offer people with no credit or those with bad credit, a change to improve their score.

Credit bureaus will look at how many accounts you have opened and how many inquires you have. The number of inquires can lower your score if you have too many at one time. This will show creditors that you are anticipating that you may have money problems and you need to get the highest credit limit possible.

Now that you have re-established your credit, you have the opportunity to look at your current lenders and negotiate for a better deal. Typically you want to look for low rates and higher limits, you might even want a credit card that offers incentives like airline tickets or cash back.

Determine what the total amount of debt you want to carry will be. For example, if you have a credit card limit of $6,000 you will only want to carry 30% of this balance at one time. What this means is; that although you can use $6,000, you should only try and use $1,800 at one time.

Once you have obtained your credit reports, you need to look at 2 main things:
1. How much debt are you carrying?
2. Is there a problem with your account such as derogatory information?
In 2004, a California Public Interest Group study reveled that 71% of all credit reports contained errors. Due to these errors, 25% of these consumers were denied credit due to these errors. As you can see, it is very important to review your credit report often so you won't be denied credit for an error. What is considered a major delinquency?

• Anything that is in the "public records" section of your credit report.
• A 90 day late payment or a foreclosure, repossession or settlement.
• If you have late payments or anything in the public records that is less than 12 months old in your credit report, it will negatively affect your chance of obtaining new credit.
• How can you determine how much debt you are carrying?
• First, add up the total number of accounts you have that have a balance. The more accounts you have, the lower your credit score will be.
• Second, add up the number of credit cards you have that are carrying a balance, again, the more you have with a balance, the lower your score will be.
• Third, determine how much of your total credit you are utilizing for each account. You can get this figure by diving the credit card balance by the total credit limit, the higher the percentage you have, then the lower your score will be.
• If you determine that you have problems in all these areas then your credit is bad and you probably won't be able to obtain a loan from any lender.

How can you fix your credit issues?
Once you have taken the steps to determine just how bad your credit is, how do you fix your credit issues? The good news is that you have determined you have a problem that needs fixing and you are ready to take the steps toward improving it. From this point, your credit score has nowhere to go but up towards improvement.

Begin by realizing that the way you have been handling your credit is exactly opposite of what you need to be doing. You need to make a significant lifestyle change in order to fix your problem. Determine what you have been doing wrong and address the issue.

Establish a recovery plan. Depending upon which type of strategy you choose, some plans will tell you to start paying off the debt with the largest interest rate first, others will suggest you start with the accounts with the lowest balances. Other plans include closing your accounts and living a credit free life while you fix your debt. If you do close your accounts to re-establish your credit, you are not going to get the best rates for a few years. In order to re-establish your credit, you need to build up your credit by properly managing your credit cards and loan accounts.

A popular method many people use is Clark Howard's credit card method. Howard gives advice to people about debt and many other things, here is how his program works:

"Indebtedness and the inability to save money, these two are tied together. And when you think about the fact that over 3 billion solicitations will be mailed this year for new lines of credit to consumers, it's no wonder that the availability of credit is so tempting and that so many people spend themselves into oblivion." Howard stresses that dealing with debt is a major challenge for many people. Because so many of Howard's listeners struggle with credit card debt, he created a credit card debt program that will help you get out of debt in 30 months.

Depending upon your situation, Clark Howard can help. With car loans, Howard believes that people should pay out those debts as agreed because that debt is for an infinite period of time and will be paid no matter what. He feels the same way about a home loan as well. The biggest debt to worry about is with credit cards. Depending upon how much credit card debt you are carrying, Howard likes people to look at becoming debt free in 30 months.

Start tackling your highest-interest rate debt first. You should start paying the minimums on all the other credit cards and paying as much as you can toward the higher interest rate cards. Once you wipe out one credit card debt, you will move on to the next highest and so on until your debt is paid.

Clark Howard's 30 month program will show you the progress you are making in paying down your debt balances and putting yourself under a firm timeline to pay off your credit card debt. Howard's program is similar to a car loan; you set yourself up on a firm timeline and agree to pay it all off by a certain date.

Other ways to re-establish your credit.
Open a savings account, this shows creditors that you are willing to save and you have a reserve to pay your debts. As you work toward building a solid credit history, you have a few several options to look at. Secured credit cards are one way to re-build your credit. Secured credit cards offer people with no credit or those with bad credit, a change to improve their score.

Credit bureaus will look at how many accounts you have opened and how many inquires you have. The number of inquires can lower your score if you have too many at one time. This will show creditors that you are anticipating that you may have money problems and you need to get the highest credit limit possible.

Now that you have re-established your credit, you have the opportunity to look at your current lenders and negotiate for a better deal. Typically you want to look for low rates and higher limits, you might even want a credit card that offers incentives like airline tickets or cash back.

Determine what the total amount of debt you want to carry will be. For example, if you have a credit card limit of $6,000 you will only want to carry 30% of this balance at one time. What this means is; that although you can use $6,000, you should only try and use $1,800 at one time.