by Lynndee Marony

Created on: May 12, 2010   Last Updated: May 13, 2010

Bad credit can affect your life in many ways, such as: paying higher interest rate, failure to get a job, paying higher premiums on insurance, failure to get a loan or financing and massive damage to your self esteem. 

Acknowledging you have bad credit is a tough pill to swallow.  Acknowledging this fact, however, is the first step you must take to begin to make the trip up the road to good credit. People tend to hide their head under the blanket and pretend their credit is fine. They may struggle to make payments to credit cards, fight to stay above water until they finally give up the fight and decide they can live without credit.

The problem is we do need to have access to credit. It is easy to decide to live without credit until an emergency arises and you need a loan. At that point, it is too late. You cannot rebuild your credit overnight but you can move on from bad credit, turn over a new leaf and begin again. 

Step One: 

As mentioned above, the first step is to acknowledge you have bad credit. Acknowledge it and lose the guilt or shame associated with the bad credit. There is no room for guilt. You should have learned your lesson on how bad credit can affect you and now it is time to move forward, letting go of the shame and begin to upward climb to a good and positive credit history. 

Step Two:

Credit is never so bad that you cannot begin to rebuild immediately. It is a fallacy that you must wait 7 years for the negative information to fall off of your credit. The longer you wait, the longer your credit report is full of only negative information. You must start getting positive credit added. Even if your credit is so bad that you can't raise your score, adding positive credit can at least mitigate the damage and lessen the climb back up when the negative information is not so damaging.

Step Three: 

Forget what you may have read about disputing items or trying to settle debts first. The first physical step you must take is to get positive credit added to your report. This is not done by disputing or settling debts.  This is only done two ways: If you have an open credit account, make sure you make every single payment on time from this moment forward.

If you do not have any open, positive accounts showing, you must get a secured credit card now. Check with your local bank or credit union to see if they offer a secured credit card. If not, do an internet search on secured credit cards. Find one that does not charge

• 1
• 2
• Next Page >>