Tough Choice: 3 Choices Toward Improving Your Credit Restoration

a. Manage your bills and pay them off

b. Negotiate collections/judgments with creditors

c. Seek advice on filing for bankruptcy

Rebuild a positive Credit History:

a. Add a primary user's positive trade line which increases utilized credit to available credit ratio

b. Deposit cash into a bank cd, then take a loan out on the cd, have on-time payments reported to credit bureaus

c. Deposit cash on new secured credit cards, make payments on time, have it reported to credit bureaus

Credit Repair:

Never be late: one 30 day late payment could cause your score to drop 100-140 points. Never max out credit cards: (goal: balances under 20% preferred on all,) Get secured prepaid credit cards: your on-time payments will create a positive payment history. Distribute balances evenly: distribute overall credit cards (Goal: balances under 20% preferred on all.) That means to get your cards down below 70% first, then 50%, then 30%)

Credit Mix:

Establish various types of credit, mortgage, car loan, credit card account. Don't close unused credit accounts: this may be your long-term credit history which factors into your score

Increase Credit limits on your Credit Cards:

Higher limits on your credit cards lower your utilized/available credit ratio percentage. Limit your credit inquiries (Each one can lower your credit score a few points)

Don't open too many accounts within a short period of time.

Get a checking or savings account (Always keep a positive balance)

Avoid debt consolidation programs: (This may continue to report as rolling late payments for years)

Watch for credit cards that report your highest balance as a high limit. (Some credit card companies will report your highest balance to date, as the new credit limit, making you appear maxed out) Credit bureaus may update balances at different times of the month than your payment

Add positive tradelines to your credit report

Have a professional negotiate charge-offs, collections & judgments after a closing

Open business credit doesn't show up on your personal credit report unless late

Bankruptcy hurts your credit

Creditors are not required to report to the credit bureaus

Have paid collections and judgments deleted off vs. reporting as 'paid in full'

Become an authorized user on someone else's account

Dissolve joint accounts after a divorce

Utilize proper monitoring and identity theft protection