 TITLE: Manageable Steps to Rebuild Your Credit CONTENT: Rebuild Your Credit with Our Easy to Follow Steps\n-------------------------------------------------\n###### Written by: Kristy Welsh\n_Last Updated: April 4, 2017_\nThe longer you live with bad credit, the more daunting the road back to good credit can feel. That's why it's important to break down the process of rebuilding your credit into manageable steps. You never want to try to do everything all at once but rather, take little steps and slowly chip away at all the negative items on your credit report. We want to make the process of rebuilding your credit as easy as possible, which is why we put together this article to show you the steps needed top make your credit repair process a success. Remember to be patient and have faith that, over time, you will see gradual, but certain, improvement in your credit score.\nMonitor Your Credit Reports\n---------------------------\nYou're entitled to one free report from each of the three major credit reporting agencies once per year. Make it a point to request your copies via AnnualCreditReport.com.\nLook For Errors On Your Credit Reports\n--------------------------------------\nAfter you request your credit reports and you have a chance to look them over, make a point to see if there are any errors. Some errors may include:\n*   Misspelling of your name.\n*   Wrong address(es).\n*   Credit accounts you know are in good standing but are listed as late, in collections, or charged-off.\n*   Credit accounts that have passed their statute of limitations, meaning you are no longer legally required to pay the debt; statutes vary by state.\n*   Credit accounts that you never opened.\n*   Duplicate listings of the same account, which can occur when it is sold from one collection agency to another.\nDispute Any and All Errors on Your Credit Reports\n-------------------------------------------------\nSend a certified letter to the appropriate credit reporting agency. It's important to dispute even the smallest of details, including a name misspelling or inaccurate mailing address, as this could suggest your identity is being confused with someone else.\nRequest a Validation of Old Debt\n--------------------------------\nThis refers to any account that is no longer being collected by the original creditor. When an account is sold to a collection agency, documentation supporting adequate proof of the debt doesn't always go with it. And the more times the account is sold, the thinner the proof. This is important because you are not legally obligated to pay a debt that the collector cannot prove you are are legally responsible for.\nTry Negotiating A Settlement on Your Debt\n-----------------------------------------\nSee if you can settle for less than the amount owed, as well as removal of the negative listing from your reports (which they are not required to do, but it's worth a try). If you do reach a settlement, be sure to get it in writing!\nMake Note of Dates When Negative Listings Should Fall Off Your Credit Reports\n-----------------------------------------------------------------------------\n*   Late payments: 7 years from date payment was late\n*   Collection accounts: 7.5 years from date of delinquency on original debt (leading up to collection)\n*   Charge-offs: 7 years from date of charge-off\n*   Tax liens: 7 years after paid\/satisfied\n*   Judgments: 7 years from date entered by the court if paid, possibly longer if unpaid\n*   Repossession: 7 years from date repo occurred\n*   Bankruptcy: 10 years from the date filed\n*   Chapter 13 bankruptcy: 7 years from the date filed\nIf these items do not fall off your reports within the specified time period(s), dispute it with the credit bureaus.\nApply For New Lines of Credit\n-----------------------------\nYou may be a little gun-shy about using credit again, but (after debt validation) it's the best way of rebuilding your credit score. Of course, you'll have to rely on options open to someone with less-than-stellar credit:\n*   Apply for a secured credit card but only ones that reports your activity to the credit bureaus.\n*   Become an authorized user on a credit card account, the activity for which will be included on your credit reports.\n*   Co-sign on a loan with someone, the activity for which will be included on your credit reports.\n*   Open an account with a credit union, and apply for a loan. Unlike banks, which look for a reason not to lend to you, credit unions look for all the reasons you deserve it. If you're turned down, ask about a loan you can secure with a savings account or certificate of deposit.\n*   Apply for a loan through a peer-to-peer lending website, such as Prosper.com or LendingClub.com\n### Use Your Credit Cards\nThe only way credit cards can boost your score is if you demonstrate the ability to responsibly use them. This is not say you should make unnecessary purchases just to use your credit. Rather, use your cards only for things you normally buy or pay for, like groceries or the phone bill. Just remember to never charge more than you can afford to pay off at the end of the month. The goal should always be to return the balance to zero so as to avoid interest charges and to keep your credit utilization ratio low.\n### Keep Your Credit Utilization Ratio Below 30 Percent\nIn other words, never use more than 30 percent of your total credit at one time. Actually, 10 to 25 percent is an ideal target range.\n### Keep Open Credit Accounts in Good Standing\nThis means making all your payments on time, be it credit cards, car payments, house payments, utility payments, medical bills, student loans, and other credit lines that get reported to the credit bureaus.\n### Monitor Your Credit Score\nAs you take steps toward rebuilding your credit, it's helpful to see how your actions are affecting your score. This not only informs where you may place emphasis in the credit rebuilding process, but it's also a great way to stay motivated.\n### Spend Less and Save More\nTo help ensure you always have the means to pay your bills on time, go through your budget, cut where you can, and start an emergency fund from which you can draw, need be. END