A low credit score will stand in your way when it's time to finance a car or apply for a mortgage. Follow these seven steps to repair your credit score!

Your credit score will always follow you, no matter where you go.

Having bad credit can make it challenging to get approved for loans, buy a house, and even get a job. Your credit score can also affect things like insurance rates and your ability to rent a place to live. 

The bottom line is:

It’s essential to be responsible when it comes to monitoring and maintaining your credit score. 

If you’re having credit difficulties and don’t know where to start, follow these seven steps for fixing your credit, and watch your score improve. 

Find Out Your Credit Score

The best way to start improving your credit is by doing a quick assessment. If you don’t know your credit score, you can create a free account on a platform like Credit Karma to learn where you stand. 

Checking your credit score won't affect it. 

But when someone else views your credit report, it could impact your score. 

Hard credit checks are standard when applying for new credit lines, which affect your score. So don't worry about any negative impact here. If you're planning to apply for any new lines of credit, it's essential to know where you stand before applying. 

Do you know for sure that your credit score doesn't meet the requirements?

If so, you can avoid another score drop from a hard credit check during the application process. 

Checking your credit report routinely can also help you spot identity fraud and save yourself from a massive headache. So make sure you monitor your score regularly! 

Start Making Payments on Time

The best thing you can do to start improving your credit score is to make payments on time. Your credit score is a quantization of your trustworthiness and reliability when using your bank's money. 

So making payments late will always negatively impact your score. 

It's essential to make more than the minimum payment on your credit cards each month as well. This will help you avoid paying too much interest over time. 

Making larger payments will help you pay off your debts faster and improve your creditworthiness. 

Paying those utility bills on time every month can also impact your credit score. If you're a few days late for a payment, you won't see it on your credit report. Yet, if a utility bill of $150 or more is 60 days overdue, you'll find a default listed on your credit report.

Review Your Credit Report

Credit agencies are fallible just like anyone else, so make sure to take the time and carefully review your credit report to guarantee it's correct. Mistakes happen, and there's no reason why you should let them negatively impact your credit score. 

If you made a payment on the first of the month, but it doesn't appear on your credit report, you need to contact your credit agency and submit a dispute. 

Some other common causes for credit disputes are incorrect debt amounts listed and seeing debt you didn't take out.

Lower Your Credit Utilization Rate

Your credit score can suffer simply from using too much of your available credit. This might seem counterintuitive since you received approval for a certain amount of credit. 

But using too much of it doesn’t look good to the bank. 

The less credit you use while maintaining regular payments, the better your credit will look. 

For an optimal credit score, you should be utilizing no more than 20-25% of your credit limit, and the less you use, the better.

Don’t Apply for Any New Lines of Credit

Too many credit inquiries can damage your credit score, so don’t apply for any new lines of credit if you’re undergoing credit repair. 

The average age of your credit is a factor in the calculation of your credit score. Getting a new line of credit would lower the average age, and with it, your credit score. So it may be wise to hold off on any new credit cards until your score has improved significantly. 

Depending on your situation, more available credit may help improve your utilization rate. This could be a strategic move if you get something like a secured credit card. 

Get a Secured Credit Card

A secured credit card is a decent way to help you build credit with much less risk since it's backed by a deposit you make when signing up. 

Because you provide collateral upfront, it’s much easier to get approved for a secured credit card. That gives you a chance to build credit without worrying about owing too much.

You usually get your security deposit back after a certain number of months or when you close your account. 

In other words, there's almost nothing to lose!

Seek Credit Counseling 

Credit counseling is the best option for anyone with credit trouble. The process of fixing your credit can seem overwhelming or confusing, but credit counselors make it much more manageable. 

They can help you:

● Understand your credit score

● Learn how to raise your score

● Plan and budget for your finances

● Negotiate to get you lower interest rates and monthly payments

Credit counseling service providers like the National Foundation for Credit Counseling offer free educational workshops. So even if you don’t work with a counselor one-on-one, you can learn how to help yourself and work toward repairing and building your credit score.

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Conclusion

It's not the end of the world if your credit score is less than stellar. But building it back isn’t as complicated as you might think. 

If you monitor your credit score, make payments on time, lower your credit utilization as much as you can, and don’t apply for any new lines of credit, you’ll start to see your score improve, and your credit nightmare will be over.

Adam Marshall is a freelance writer who specializes in all things apartment organization, real estate, and college advice. He currently works with Grove at Huntsville to help them with their online marketing.