- 1). Review your credit report. The first step to repairing credit is reviewing your credit report. Get a copy through Annual Credit Report (see Resources). Inaccurate information should be disputed with the reporting agency. Write a dispute letter to the credit bureau with a copy of your credit report (disputed items circled) and supporting documentation (such as a police report in cases of fraud). The Federal Trade Commission (FTC) offers a sample letter on their Website.
- 2). Focus on the areas that most heavily weigh on your credit score. Payment history and debt have the largest impact on your credit score, according to MSN Money. Focus on these areas, and your credit score will rise quicker. Set up automatic payments with your financial institution to ensure timely payments. Focus on paying down revolving debt to 30 percent or less of the available limit.
- 3). Partner with collection departments. Consumers often avoid collection departments. If you partner with these organizations, however, you can agree on a monthly payment plan, allowing to you get rid of collection activity on your credit report. Some collection departments may even be willing to settle for less than you owe.
- 4). Avoid opening large amounts of new credit. Opening several new accounts at once will lower your credit score. Instead, focus on using existing credit and paying it off each month. This will show credit bureaus your ability to use credit responsibly.
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