Bad Credit might seem like a dealbraker when you want to buy a house, but if something is broken, it can be fixed. Below is an awesome article by Forbes to help you repair your situation:


While the average credit score in the U.S. is 710, that doesn’t mean everyone has good credit. If you happen to have a poor or damaged credit score (typically below 670), it can hold you back from the things you want, whether that’s getting a new car, renting a nice apartment or buying your dream home.

However, there are steps you can take to fix your credit that we outline below.

1. Check Your Credit Score & Report

Your credit report contains information about how you’ve used credit in the past 10 years. You have one credit report at each of the three bureaus: Equifax, Experian and TransUnion. Most creditors report to all three, but not all, so it’s worth checking the information on all three of these reports. You can get free weekly credit reports until April 20, 2022, at

Your credit report is used to calculate your credit score, and it’s important to check this too. You can check your credit score for free through credit scoring websites or some credit card providers. Checking your own score only requires a soft credit inquiry, which doesn’t damage your score. We recommend checking your score once per month.

2. Fix or Dispute Any Errors

Unfortunately, credit bureaus sometimes make errors. According to one study by the Federal Trade Commission, a quarter of people had errors on their credit report and 5% of people had errors that could have made getting a loan more costly for them.

So while knowing your credit report and credit score is a good first step, it’s also crucial to look for errors. If you spot any, it’s a relatively simple process to dispute those errors and have them removed.

3. Always Pay Your Bills On Time

Your payment history makes up 35% of your credit score. So if you want to fix your credit, you should focus on ironing out your monthly payments. While it may feel like a challenge to pay all of your bills on time, there’s a simple hack to getting this right: autopay.

If you have bills that don’t permit autopay—like one-off medical bills—pay them as soon as you get them. If you can’t, contact the office and work out a payment plan.
If you’re worried about overdrawing your account, we recommend setting up a budget and/or scheduling your autopay for the same time you get paid.

4. Keep Your Credit Utilization Ratio Below 30%

Your credit utilization ratio is measured by comparing your credit card balances to your overall credit card limit. Lenders use this ratio to evaluate how well you manage your finances. A ratio of less than 30% and greater than 0% is generally considered good.

For example, let’s say you have two cards with individual credit limits of $2,000 and $500 of unpaid balances on one card. Your credit utilization ratio would be 12.5%. In this case, total your debt owed ($500) and then divide that by your total credit limit ($4000).

5. Pay Down Other Debts

If you have outstanding debts, paying them off can help improve your payment history and reduce your credit utilization ratio.

When planning to repay your credit card debt, consider the debt avalanche or snowball method. The debt avalanche method focuses on repaying your high-interest cards first while the snowball method focuses on repaying your smallest balances first. Evaluate both to determine which method is best for your situation.

If you plan to repay loan debt, it’s important to note that you might see a temporary dip in your credit score. But rest assured, this will improve your credit score in the long term, according to Experian.

6. Keep Old Credit Cards Open

You might be tempted to close old credit cards when you’ve paid them off. However, don’t be so quick to do so. By keeping them open, you can establish a long credit history, which makes up 15% of your credit score.

There are a few caveats here, though. Your issuer may close your card after a certain period of inactivity and if it charges an annual fee, it might be worth closing.

7. Don’t Take Out Credit Unless You Need It

Each time you apply for credit, your creditor will run a hard credit check. This can drop your score by one to five points. It’ll also lower your average account age, which also can drop your credit score. So, as a rule of thumb, try to avoid applying for credit unless you really need it.

Can You Pay a Company to Fix Your Credit?

Credit repair companies work mostly by deleting negative information from your credit report, typically errors. But that’s only one tiny part of fixing your credit score. And you might be able to dispute errors yourself faster.

So not only are credit repair companies expensive (often around $50-$100 per month, according to Experian), but you can do it on your own. And if you really need credit help, you can always seek affordable assistance from a nonprofit credit counselor through the National Foundation for Credit Counseling.

How Long Does It Take to Fix Your Credit?

While you may take some actions to improve your credit, like paying down your credit card balance, it could take longer than you expect to see the results. Sometimes it can take at least a few weeks for creditors to report your payment information and companies to update your score because of it. In general, fixing your credit score is a long-term game.

Next Steps: Check Your Credit Score Regularly

Once you start taking the steps to fix your credit, it’s a good idea to keep regular tabs on your score by checking it once a month. That way, you’ll be able to catch any errors and see how your actions are playing a role in improving your score.

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