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Step 1
Get copies of your Equifax, Experian and TransUnion credit reports. You are entitled to one free annual credit report per agency. These reports can be obtained online through AnnualCreditReport.
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Step 2
Review your reports and note any possible errors, such as incorrect collection accounts and late payments that may not have occurred.
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Step 3
Contact the credit reporting agency and tell them which accounts you feel are incorrect. They have 30 days to investigate your claim, and they may delete the entries if they cannot be proven by the reporting creditor.
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Step 4
Visit your local bank or credit union and ask for a savings account secured loan as a way to help correct your credit rating. You will be borrowing against your own money, but this will only cost you a few dollars of interest. The account will report on your credit files, which will go a long way toward restoring your credit rating.
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Step 5
Apply for unsecured credit cards for people with bad credit. Popular lenders for credit-challenged customers are Orchard Bank, First PREMIER, and Centennial.
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Step 6
Charge small purchases on your new credit card. Pay normal expenses such as utility bills, cable fees and gas on the credit card to avoid accruing unnecessary debt.
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Step 7
Pay off most or all of your credit card billing statement each month. Your credit rating will improve by making on-time payments and keeping the card under the limit.
