I’m in over my head with my credit card bills. I’m slowly paying them off, but I don’t know how I will ever regain good credit. How can I rebuild my damaged credit?

You’re not alone in your credit problems. It is easy to get carried away with credit cards and loans. First, it’s good to know what your standing credit is. You can do this by entering “online credit report” into a search engine, such as Google, and selecting from one of the many available options. For a small cost, you will be able to see exactly what creditors see when they look up your credit history and rating. Carefully look over your report for any mistakes that need fixing; mistakes have been known to happen.

If you find that you have a rather good credit rating, here are a few tips to keep it that way:

1. If you miss one month’s payment, be sure to make a payment the following month. Accounts more than 60 days past due will show up on your credit report.

2. If you fall behind on a payment for a legitimate reason, such as illness, unemployment, or family issues, send a short explanation to the credit reporting agencies (the three major credit reporting agencies are Equifax, Experian, and TransUnion). They will add this to your credit report so that future creditors will see it next to late payments. Also, call your creditor with an explanation and attempt to work out a solution.

3. Minimize the number of inquiries on your credit report. Don’t apply for multiple credit cards or loans over a short period of time.


If you are unpleasantly surprised by your credit rating, here are some steps that you can take to slowly rebuild your credit over time:

1. Open and pay off a variety of types of accounts rather than adding debt to an existing credit card.

2. Use your new accounts in moderation and make payments that are more than the minimum. Avoid carrying a balance that is more than 30 percent of your credit limit.

3. Start small, with cards from department stores or your local credit union.

4. If your credit has gotten to the point where you can’t qualify on your own for an account, consider asking a friend or family member to co-sign for a small loan or credit card.

5. Consider a secured credit card. They are guaranteed by a deposit that you make with your credit grantor. Make sure that the grantor reports payment history to one of the major credit bureaus so that you are building positive payment history.

6. Don’t be afraid to ask for help. There are several non-profit agencies that can help you to get your credit back on track. One such agency is the Consumer Credit Counseling Service cccsinc.org.