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5 Quick Tips on How to Successfully Repair Your Credit

Updated on March 20, 2015

Do you currently have credit issues you’re dealing with? Perhaps you would like to qualify for a mortgage, an auto loan or even a small business loan? If so, then you’ll certainly need to do a bit of credit overhauling. Unbeknownst to many consumers suffering from credit blunders are the many credit professionals now offering quality services to its thousands of clients. Credit repair isn’t a magic fix. However, it can have a lasting impression on your personal finances—especially if done correctly. Gone are the days when credit repair organizations (CROs) bilked millions of consumers out of their hard earn monies, making bold and outlandish statements, including offering consumers brand new identities. Nowadays, the industry has vastly changed for the better: perhaps as an answer to the surge in the consumer credit services, the credit repair market is now headed by highly trained and certified professionals such as credit repair lawyers, financial counselors and credit advisers. The overall benefit these individuals and organizations represent within the realm of credit repair can’t be overstated; nevertheless, if successful, credit repair will depend on a number of different factors. The following list below highlights five quick tips you should follow to reach your personal financial goals:

#1 It All Depends on You…Don't Procrastinate

Knowledge trumps all! This especially holds true in the credit repair industry. Sure, a credit repair law firm or a reputable non-profit consumer credit organization should be able to accomplish a lot of good. However, if you truly want to rid yourself of that stubborn low FICO score, you’ll first have to put forth a little effort. Mainly, this will entail doing some research on your own, learning and taking-in as much information (i.e., reading books, viewing websites, attending seminars, etc.) as possible on credit rebuilding tactics. This is critical—especially if you want to attain a high FICO score, including one that is 750 and above.

#2 Creating Positive Data…

What’s a tradeline? A tradeline is an actual line of data on a consumer credit report. It can be either negative or positive, depending on what you have on it (i.e., a paid charge-off, an unpaid collection account, etc.) For pure purposes of credit repair, many consumers neglect to use this very important step: FICO scoring system is based on recent credit activity—namely, the sooner you establish a positive payment pattern, including paying your balance off in full each month, the sooner you should realize a better score increase. Thus, it can be said that, if you don’t have at least three active and positive tradelines, then FICO won’t be able to sufficiently score you correctly. Remember: in order to maintain a good FICO score, you must give FICO good recent data to score you on a monthly basis.

#3 Managing Debt to Success…

What’s the point of overhauling your credit if you continue to make the same mistake that got you into this mess in the first place. You mustn’t forget, the FICO scoring system isn’t a bunch of human beings—it’s a mathematical formula that simply reads code. Still yet, there’s a rule of thumb—maybe even an unwritten law—many credit and financial gurus advocate you should follow to maintain a high FICO score: “Keep your debt utilization ratio below 30 percent!”

#4 An Effective But Simple Solution…

Now that you have credit, what should you do with it? Perhaps the easy answer is to simply use, but you must tread with a bit of caution when involved in credit score enhancement. To be exact, throwing all caution to the wind when dealing with FICO’s labyrinth scoring model is never considered a viable option. However, most consumers with very high FICO scores find it suitable to use their new credit cards to make small purchases such as for a tank of gas, a bag of groceries or even a night out for dinner, making sure to pay all but five or ten dollars of the bill. Remember: you want to always keep the account active enough over a period of time to give FICO something to score.

#5 The Final Payoff…

Does a one hundred point boost to your FICO scores sounds good to you? Certainly, such a feat isn’t impossible! Even if you fall short of your credit goals, what matters the most is simply the idea that you gave it your all and “you and only you” can affect your personal financial situation. In stark contrast, CROs exists to speed up the process a bit, however, a great deal of effort, especially in the areas of credit rebuilding (i.e., opening secured credit cards, managing new charge accounts, etc.) is really all that’s needed to get you on your way to a better FICO score. It can be done!


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