Credit problems from the past can last well into the future. The small things that may not worry you too much or the big scary ones can BOTH wreck havoc on your credit score. Remember, credit is your promise, it is a binding contract. If you break that promise, no matter what the circumstance, it will reveal to the banks that you are a risk. And they hate risk.
Ignoring past credit problems do not make them go away. When the damage is done it remains on your credit report for years, dragging your score with it. It must be pro-actively dealt with.
4 things you must do to improve your credit score:
1. NO late payments from this point on…no matter what
2. Go after the items on your credit report. I recommend professional help. Leaving it there will only prolong the pain. Get it removed.
3. Establish new lines of credit immediately. Here’s how. Also call 866 726 3535 and ask which credit cards are extending credit to low score applicants at this time.
4. Keep very LOW balances on your credit cards. Between 7-8% of the credit limit. To improve your score you need good active accounts with LOW balances. Use the cards, make payments, do not pay them off but keep the balance very low. This will report to the bureaus and your score will begin to rise.
By not dealing with your credit past, it will trip you up in the future and cost you thousands of dollars. Here is an example: