After spending twenty years in the financial industry, most people assume that it has always been very easy for me to keep my credit pretty close to perfect.
In all honesty, I have been through many ups and downs in my life and have occasionally found myself in need of credit restoration. When people find out that I have had credit struggles too, they usually want to know how I repair my own credit.
The first step to take when working on credit repair is getting a current copy of your credit bureaus, and carefully reviewing it for any mistakes. It is not uncommon for people to find far more errors than they expect.
To illustrate my point, I once had a client who had to file for a medical bankruptcy. She had not seen the point in checking her credit report because all of her debts had been included in her bankruptcy.
After I talked her in to checking her credit, she told me that most every account she had included in the bankruptcy was still reporting with an open balance. When she got these errors corrected, she saw a rise in her FICO score.
Getting rid of your credit card debts is a great way to improve your financial health as well as your credit score. Even if you have never missed a credit card payment, carrying high balances will really drag down your credit score.
The number two factor in determining what your credit score will be is the relationship between how much credit you have that you could use and how much you are actually using. To generate the best possible score, try to get the amount you owe down below 20% of your credit limit on each individual account.
Of course, these are just a couple of things you can do to improve your credit score. For the best possible results you should create a comprehensive credit restoration plan.