5 Surefire Steps to Improve Your Credit Score

Do you want to improve your credit score but don’t know where to start? Check out this step by step guide and learn how to start to improve your credit score today!

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Before I started paying attention to my finances, I had no idea what a credit score was, how it worked, or how much it could affect me.

Then, the second hand car I had been driving for several years decided to quit on me in the middle of the road (or I-95’s exit ramp, to be exact).

Given that it was going to cost several thousands of dollars to fix it, I decided it was probably time to get a newer car.

However, I was shocked and disappointed to find out that no lender was willing to let me finance the car, and that I’d have to come up with a large down payment to go through with the purchase.

So I set off to learn more about my credit score and how to get it in good shape.

Here’s the simple steps that helped me increase my credit score, and how you can implement them as well.

Step 1: Increase Your Knowledge

The first thing that will help you improve your credit score is to learn more about what it is and how it works.

Without knowing the basics of how your credit score works and affects it, you’re basically driving blind.

I started learning more about my credit score by reading through myFICO’s blog.

myFICO is the consumer division of Fair Isaac, which is the company that came up with the FICO® score.

I figured I’d go straight to the source 🙂

Action Step

The knowledge you can get now will set a solid foundation for you to work out of, so start learning more about your credit today!

Check out myFICO and the Credit Repair section of my blog where I share everything I’ve learned along the way.

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Step 2: Find Out Where You’re Starting From

Once you’ve learned about how credit scores work, you’re ready to start working on anything that’s negatively affecting your credit.

In order to do that, however, you need to know what your starting point is.

I’ve always believed that knowledge is power and that organization goes a long way when it comes to reaching any goals.

This is especially true when it comes to any financial area.

Action Step

As a consumer, you have the right to obtain a free credit report (your credit history without the score) once every 12 months, or if you’ve been denied a credit application.

In those instances, you will receive a letter from the lender who denied your application with instructions on how to get your credit report from the three credit bureaus, Experian, Equifax, and Transunion.

You can get your reports for free from these three bureaus, or you can also pull it for free by going to www.AnnualCreditReport.com or by calling toll-free 1-877-322-8228.

Note, however, that this will only get you your credit report but not your credit score.

I recommend obtaining both your credit report and credit score by using a reputable credit monitoring service such as myFICO.

It will not only provide you with your credit report and score, but also give you clear instructions of what you can do to improve your specific situation.

Step 3: Assess the Damage

Once you have your credit report and score, you can begin to evaluate what’s hurting your credit.

If you are using a credit monitoring service, it will probably include some sort of summary of where you can improve and how.

If not, I discuss several things to watch out for below.

Action Step

Look at your report closely for any accounts that you don’t recognize, which can indicate you’ve been a victim of identity theft.

This is why it’s important to check your report regularly to detect and stop thieves as early as possible.

Additionally, watch out for anything being recorded incorrectly. A reporting error on the part of a lender can cost you!

Then, examine your report for any of the following as these are the items that normally hurt your credit the most:

• Late payments
• Accounts in collections
• Repossessions
• Credit inquiries

Step 4: Create a Plan

As I mentioned earlier, I firmly believe that organization is key.

It’s definitely one of the things that kept me sane when I was cleaning up my credit.

Why is it so important?

Because when you organize your thoughts, you get direction.

This ultimately leads you to success.

Have you ever heard that saying that goes: “A goal without a plan is just a wish”?

I believe there’s a lot of truth to that.

That’s why the next thing to do is to create a clear plan of action.

Once you have a better idea of what is hurting your credit, develop a plan to attack each of those items.

Action Step

List all the items that you identified from Step 3 above, and determine which are easier to tackle.

For example, if there’s a payment that was reported late on an account that’s always been on time, it’s reasonable to ask the lender for a one-time forgiveness allowance than to get a $10K account out of collections.

Focus on the easier items first to improve your credit score fast!

Step 5: Set the Plan in Motion

Especially in the beginning, I recommend getting some small wins under your belt.

This will help you pick up momentum to keep you going.

Many times, it’s easy to want to give up when we don’t see any progress.

Action Step

For those items that could be easily addressed, or are fairly recent, call the lender.

For those items that are older, or that will be more difficult to reach out to the creditor about, dispute the items directly with the credit bureaus through each of their websites.

I recommend focusing all your efforts on no more than one or two items at a time, and then repeating the process once those are fully addressed.

This process however, can be time consuming and difficult, to say the least, so be patient and persistent.

The results will come!

Bonus Step

If you want to learn more about the exact way I was able to increase my score from 515 to over 800, be sure to sign up for my newsletter here.

As a sign up bonus you’ll receive a free Quick Start Guide where I share how I was able to accomplish this, and how you can quickly start building up your credit as well.

To get the guide delivered to you right away, sign up today!

Having a low credit score can really impact your finances.

From the car you drive to where you work and live, being able to improve your credit score can make a huge difference.

As you follow the action steps outlined above, your score will increase over time.

Just remember that it normally takes at least a couple of months to start seeing any real progress, so don’t get discouraged if you don’t see results right away!

Has having a low credit score affected you? If so, how? Share with us in the comments below!