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10 Steps to Better Credit

John Ulzheimer
John Ulzheimer

By John Ulzheimer

1. Find out what the credit reporting agencies are saying about you - Step one to addressing the problem is finding out just how bad of a problem you have.

2. Review your credit reports for accuracy - Almost all credit reports have errors.

3. Focus on the last 24 months - The most recent past is what impacts your credit scores more than anything else.

4. …and then focus on the next 24 months - Remember, what you do in the next two years will drive your credit scores for the years to come.

5. Understand your credit standing - Just because they didn't teach this stuff in school doesn't mean you shouldn't learn it. Take some time and get to know what good credit means to your bottom line.

6. Understand what “counts” in your FICO® credit scores, and how much - The Internet is awash with inaccurate information about credit scores. Learn where to get accurate information, and then depend on it.

7. Don't let your ego or pride cost you - There's no nobility in paying 39% interest on a credit card. Recognize when you have a credit problem, and get help.

8. No knee-jerk reactions - If you think you know how to improve your credit, you better think again. Verify before you execute because it's hard to fix the damage once it's been done.

9. Avoid credit repair scams - There is no legal and ethical way to “fix” your credit. It takes time and hard work. Do it the right way.

10. Be realistic about negative credit information - You're not going to get a $25,000 platinum credit card right after you filed for bankruptcy. It's going to take time.