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How can I rebuild my credit?

By Derek Brown
Published: Monday, June 7th, 2010

Everyone and anyone are at the risk of falling into a financial rut through credits. Such situations entail disadvantages and inconveniences which include difficulty in getting future loans or being denied to get loans at all. Indeed, it may take a long time to regain the trust of creditors and get your credit back. It may take approximately two years (on average), for instance, before you could be reaccepted for a major credit card. Four years, on the other hand, would be how long before you might be able to obtain a mortgage. It is thus good to remember to be patient; rebuilding your credit takes time.

To rebuild your credit and regain their trust, it is therefore necessary to take actions that would put you in a positive light.

If you want to regain a clean reputation, it is imperative that you pay your bills on time. People who have fallen in bad light with creditors have surely learned the importance of this. Be consistent and on time when paying your bills. Avoid acquiring too much debt. Needless to say, it is not advisable to open new credit accounts. The better thing to do is to settle first any problems such as debts in your current accounts.

Rebuild your credit history by starting with a minor or small-scale credit card. Again, pay on time so as to create a good credit history. Do not immediately sign up for major credit cards to avoid the temptation of spending too much. It is always advisable to have only a single credit card, or three cards at a maximum.

Having a steady job with a steady income would also be to your advantage. Creditors see this as something positive, because it means that you are able to pay any succeeding bills you may have. Constantly changing jobs sends the message to creditors that you run the risk of not being able to consistently pay your bills and / or penalties.

Should your appeals be rejected, you may try discussing things with your lenders. This may be effective in case of great or urgent need. Creditors may look at your past spending histories and reconsider allowing you to get loans, especially if the circumstances justify you not being able to debt. Of course, if this is your first time to be in such a financial problem, which would be another factor in the creditors’ decision.

Again, keep in mind that rebuilding your credit takes time. At times, patience and alertness is the key to regaining your credit.

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