How to Build Good Credit After a Poor Credit History

Credit card and loan companies are not the only entities that care whether you have a good credit report. Landlords, insurance companies and even employers commonly use your credit report for the sole purpose of gauging whether you are responsible. Therefore, if you have a poor credit history, it is important to learn the steps to rebuild good credit.

Instructions

1

Earn the highest credit score possible. If you are late paying your bills, especially credit cards --- or have maxed out your cards --- this can earn you a poor credit history. The most dangerous mark to your credit report is a bankruptcy or foreclosure. These linger on your credit report for seven years.

2

Commit to changing your spending habits. This means paying past bills before going shopping and incurring new ones.

3

Commit to paying for your groceries and gas each month, never carrying a balance. Building such a record of reliable payments will help you build good credit. Simply set aside your grocery and gas money and pay it toward your credit cards within the same month you incurred the charges.

4

Make sure you never make the mistake of maxing out your credit cards or exceeding your credit limit. This will definitely earn you a poor credit history. This mistake will raise your interest rates and over-the-limit fees. It is said that you should always stay below 50 percent of your limit to avoid a poor credit history.

5

Pay at least $5 over the minimum payment, if money is tight. Paying more than the minimum due will definitely help you build good credit.