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If you have amassed a rocky credit history and if you are burdened with a low credit score

How to Reestablish Your Credit Rating

If you’re thinking you would like to reestablish your credit rating, you currently have bad credit or no credit at all. In either case, there are steps you can take to bring your rating up a few notches.

Dealing with Poor Credit

Let’s talk about bring up a poor score first. Your job is a little more difficult because you may have to pay some bills first. Get a copy of your credit report from the three big reporting agencies—Equifax, TransUnion, and Experian. Then take these steps toward reestablishing credit:

  1. Dispute all incorrect or old information. Procedures for some debt is covered by the Fair Credit Reporting Act (
  2. Pay off, or at least pay down, all debts that you do owe—keep accounts open if possible. If you must close some, close the newest ones. Length of time is important in credit history.
  3. Make sure creditors send the credit reporting agencies all corrections in your report.

Beginning the Rebuilding Process

Once you have done everything you can to clean up your report, you can begin rebuilding with some of the ideas that follow. Also use these techniques if you are establishing credit for the first time.


Save Money

Save some money. This will show habit changes, or if you have no credit, that you know how to handle money. It can also become collateral if need be.

Keep or Get a Job

Hold a job. Length of time on the job is a factor in determining reliability.

Visit with Old Creditors

Check old creditors for new credit. If you can show change in your habits, some old creditors may be willing to give you a second chance.

Consider Getting a New Credit Card

Get a new credit card. Don’t do this if you can’t pay off your monthly balance every month to avoid finance charges. A secured card—sometimes thought of as a credit card for people with bad credit—requires a deposit of 50 percent to 100 percent of the credit limit in a savings account that acts as collateral. After you establish a payment history, the ratio of the account to the credit limit will change or the card may even convert to an unsecured credit card. Just be careful of scams!

Get Low Limit Retail Store Credit Cards

Get low-limit retail credit cards. Often a local store will agree to give you a chance with a low-limit charge card. Some stores also offer layaways, where they will allow you to make payments while they hold the item for you—this would be like putting in a good word for a store card.

By following these various tips, you will find yourself in the position of being able to rebuild your credit with really good results in the not too distant future.