How to repair your credit and improve your FICO^® Scores

You can improve your FICO Scores by first fixing errors in your credit history (if errors exist) and then following these guidelines to maintain a consistent and good credit history. Repairing bad credit or building credit for the first time takes patience and discipline. There is no quick way to fix a credit score. In fact, quick-fix efforts are the most likely to backfire, so beware of any advice that claims to improve your credit score fast.

The best advice for rebuilding credit is to manage it responsibly over time. If you haven't done that, then you'll need to repair your credit history before you see your credit score improve. The following steps will help you with that.

Steps to improve your FICO Score

1. Check your credit report for errors

   Carefully review your credit report from all three credit reporting agencies for any incorrect information. Dispute inaccurate or missing information by contacting the credit reporting agency and your lender. Read more about disputing errors on your credit report.

   Remember: checking your own credit report or FICO Score has no impact on your credit score.

2. Pay bills on time

   Making payments on time to your lenders and creditors is one of the biggest contributing factors to your credit scores—making up 35% of a FICO Score calculation. Past problems like missed or late payments are not easily fixed.

   • Pay your bills on time: delinquent payments, even if only a few days late, and collections can have a significantly negative impact on your FICO Scores. Use payment reminders through your banks' online portals if they offer the option. Consider enrolling in automatic payments through your credit card and loan providers to have payments automatically debited from your bank account.

   • If you have missed payments, get current and stay current: poor credit performance won't haunt you forever. The longer you pay your bills on time after being late, the more your FICO Scores should increase. The impact of past credit problems on your FICO Scores fades as time passes and as recent good payment patterns show up on your credit report.

   • Be aware that paying off a collection account will not remove it from your credit report: it will stay on your report for seven years.

   • If you are having trouble making ends meet, contact your creditors or see a legitimate credit counselor: this won't rebuild your credit score immediately, but if you can begin to manage your credit and pay on time, your score should increase over time. Seeking assistance from a credit counseling service will not hurt your FICO Scores.

3. Reduce the amount of debt you owe

   Your credit utilization, or the balance of your debt to available credit, contributes 30% to a FICO Score's calculation. It can be easier to clean up than payment history, but it requires financial discipline and understanding the tips below.

   • Keep balances low on credit cards and other revolving credit: high outstanding debt can negatively affect a credit score.

   • Pay off debt rather than moving it around: the most effective way to improve your credit scores in this area is by paying down your revolving (credit card) debt. In fact, owing the same amount but having fewer open accounts may lower your scores. Come up with a payment plan that puts most of your payment budget towards the highest interest cards first, while maintaining minimum payments on your other accounts.

   • Don't close unused credit cards as a short-term strategy to raise your scores.

   • Don't open several new credit cards you don't need to increase your available credit: this approach could backfire and actually lower your credit scores.

   
   

   Watch to see how you can manage your FICO Scores:

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     Managing your FICO Scores - open video

     Managing your FICO Scores

     Video transcript

More tips on how to fix your FICO Score & maintain good credit:

• If you have been managing credit for a short time, don't open a lot of new accounts too rapidly: new accounts will lower your average account age, which will have a larger impact on your scores if you don't have a lot of other credit information. Also, rapid account buildup can look risky if you are a new credit user.

• Do your rate shopping for a loan within a focused period of time: FICO Scores distinguish between a search for a single loan and a search for many new credit lines, in part by the length of time over which you make your inquiries.

• Re-establish your credit history if you have had problems: opening new accounts responsibly and paying them off on time will raise your credit score in the long term.

• Request and check your credit report: this won't affect your score, as long as you order your credit report directly from the credit reporting agency or through an organization authorized to provide credit reports to consumers.

• Apply for and open new credit accounts only as needed: don't open accounts just to have a better credit mix—it probably won't raise your credit score.

• Have credit cards but manage them responsibly: in general, having credit cards and installment loans (and making your payments on time) will rebuild your credit scores. Someone with no credit cards, for example, tends to be higher risk than someone who has managed credit cards responsibly.

• Note that closing an account doesn't make it go away: a closed account will still show up on your credit report and may be considered when calculating your credit score.

• Credit and financial counseling: need personalized help understanding and improving your credit? Many nonprofit organizations offer free or low-cost credit and financial counseling services. Counselors can provide guidance on budgeting, debt management, housing, and financial education. Learn more about credit and financial counseling.

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