5 Really Smart Strategies On How To Fix A Bad Credit Report

couple worrying about how to fix a bad credit report

How to Fix a Bad Credit Report – 5 Strategies To Improve Your Credit

Credit is a mystifying and frustrating roadblock for many people. So, if you’re trying to apply for a new credit card, take out a loan, or get a mortgage, your credit is everything. Therefore, follow these five tips on how to fix a bad credit report and live your best life.

man with cartoon sad face

1. Reduce Your Credit Card Utilization to Fix a Bad Credit Report

Excess credit card utilization is one of the biggest impediments to a good credit score.

While high utilization does not necessarily translate to debt, it reflects poorly on your financial habits.

You should aim for 30% or less utilization on all of your cards. Moreover, maintaining a low utilization will show credit bureaus you are a responsible candidate for a credit card, loan, or mortgage.

Lowering your credit card utilization is one of the most powerful ways to fix a bad credit report.

To improve your credit utilization rate, you can request to increase your credit limit.

Be careful, however, to keep your utilization low by reducing your spending even though you’ve have the power to spend more.

2. Apply for a Credit Builder Loan

A credit-builder loan can help you fix a bad credit report by loaning you money to correct it.

These loans usually offered by small banks and credit unions to those customers with poor or no credit history.

You must pay a deposit to be eligible for most credit-builder loans. The money you borrow as a loan gets placed in a savings account until the loan pays off.

3. Write a Debt Validation Letter

A debt validation letter is a way to challenge whether debt on your credit score is actually yours or not.

pen and paper

The Fair Debt Collection Practices Act (FDCPA) ensures you can find out if there is any invalid debt on your credit report.

Follow this format to send a debt validation letter today.

4. Place an Equifax Free Credit Report Freeze on Your Financial Accounts

To prevent your account from identity theft, consider implementing an Equifax free credit report freeze and using a credit monitoring service.

Freezing your Equifax credit report will not negatively affect your credit score. Your score can still be viewed by authorized users given your permission.

Furthermore, this step simply protects your identity.

If you place an Equifax free credit report freeze on your account, fraudulent users will be unable to open credit cards, request loans, or buy mortgages under your identity.

5. Get Out of Student Loan Debt

They say an education is worth more than gold, but the cost of college tuition can put a hefty strain on your credit report.

students celebrating graduation

As a matter of fact, one way to reduce student loan debt is to refinance student loans.

Refinancing your student loans will help reduce the interest you’re paying on your student debt loans and will help you improve your credit score long term.

Research

Study your credit score carefully to see which areas need improvement.  As a result, you will be well on you way to a complete understanding of how to fix a bad credit report.

Consult trusted resources like Creditsquared.com to improve your credit and change your life.

Get Control of Your Credit With Our Free Ebook

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4 Comments

  1. I’ve written debt validation letters in the past. Surprisingly, they work. Best way to do it is to get your credit report and dispute any reports that might be suspect.

    Same with student loans. I’ve used the Income Based plan now for some years, and have always had low payments. Simple as filling out paperwork.

    Overall, good list. Got any recommendations for where to go to refinance student loans?

    Thanks for the info.

    Michael

    • Michael,

      Sounds like your are on top of things.  Readers will be encouraged by your repsonse,

      Student loans are manageable if one is proactive. Just don’t be afraid to pick up the phone or do some research online and you will find the solution that works best for you.

      Here is a site that may be helpful with refinancing a student loan.

      Refinance a Student Loan

      Thanks,

      Patrick,

      Creditsquared.com

  2. Hi,Patrick.

    Thanks for your insights on how to fix a bad credit report.

    I’m interested in getting a loan and want to borrow $10,000 to consolidate my debt.

    I realize that I need to fix my credit report first before I can get a loan. 

    I have a different kinds of debt with pay day loans and rent to own products.

    Thank you for the tips on correcting a bad credit report.

    I will definitely write a debt validation letter and request an Equifax free credit report freeze to protect myself from credit fraud. I don’t have any credit cards so that’s a plus.

    Thanks for the great info! 

    I also noticed a few of your other articles that caught my eye. I’m sure these will be of some assistance in improving my credit situation.

    • Hi Sonny,

      I’m happy to hear the content was helpful to you.  There is lots more, so look around my site for more helpful tips on improving your credit.

      It’s tough getting your credit situation back to normal, but if you stay focused, which it appears that is what you are doing, you will get there.

      I know you can do it!  So if you have any other question please feel free to send me an email or leave a question in the comments area.

      Here is a helpful post to get you started.

      How To Improve Credit Score

      All the best,

      Patrick

      Creditsquared.com

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