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I Need to Rebuild My Credit, Where Do I Start?

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We recently received this question from a reader who is looking for help with credit report errors:

There are things on my credit report that do not belong on there. Things like where I have lived and accounts that have been paid off for over 10 years. How can I have them corrected? I also received a call from a collections agency saying I owed them money. When I checked into it, I found out it was for someone else named “Dale” and I’ve asked that they remove it from my credit. In June and July of last year, I paid off a lot of my bills and I’d like to find out if there are any other payments that are late so I can pay them. What else can I do to get my credit score back?

The very first step to figuring out where to even begin rebuilding bad credit is to order copies of your credit reports. Without knowing what’s being reported in your credit reports, you’ll have no idea where to even begin. Based on your question, it sounds like you’ve ordered one of your credit reports — which is a great start, but we’d also encourage you to order all three of your credit reports from each of the major credit bureaus: Equifax, Experian and TransUnion. By law, you’re entitled to one free copy of your credit report (from all three bureaus) once every 12 months.

Disputing Credit Report Errors

Once you’ve ordered all of your credit reports, your next step is to go through them line by line and review them for accuracy. Pay close attention to all of the accounts and balances, and any missed payments or negative public record information like collections, liens or judgments. This information has a direct impact on your credit scores so it’s important that it’s as accurate and up to date as possible.

Remember, your credit scores are only as accurate as the information contained within your credit reports. Personal identifying information like your current and previous addresses, aliases and current/past employers won’t have an impact on your credit or credit scores, but if the information is wrong it’s still a good idea to file a dispute and have it corrected — if only to give yourself peace of mind and limit any possible worries about identity theft.

Statutes of Limitations on Credit Reporting

Regarding the accounts that are more than 10 years old, it would depend on the individual account but typically most negative account information will remain on your credit report for seven years. Positive accounts will remain for 10 years from the date closed, and open/active positive accounts will remain on your credit reports indefinitely.

How to Boost Your Credit Score

You’ve made great strides already by being proactive and paying off delinquent accounts and old debts, but to find out exactly what you need to do to improve your credit score, you need to know where to start.

There is no “one size fits all” credit improvement plan — what may be great advice for someone else, could be terrible advice for you. This is why all credit scores include what’s called “score factors” or “reason codes” that help you pinpoint exactly why your score is what it is and also help you identify the areas that you need to focus on in order to improve.  If you haven’t already ordered your credit score, the Credit Report Card from Credit.com is a great place to start — and it’s free.

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  • Candice

    I have delinquent accounts. They have been there for at least 5 years. Will it hurt my credit more if I start paying them off or if I leave them there?

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  • Luke

    I recently filed for bankruptcy and had a 420 FICO score last time I checked. What should I do to start getting my FICO score in the 700’s? Thanks.

  • Brian


    This is my advise: Don’t pay them. In two years, they will drop off your report. But if you pay them anything, they become active again and will stay on for another 7 years after you make your payment even if you pay it off in full. I learned this the hard way when I paid off a collection account that I had disputed for over 2 years. Paying it off does not take it off your credit report. I would go to the account holders after they are off your credit report and offer to pay them off if they do not reactivate the accounts and report them to the credit agencies.

  • Igby

    Interesting! I was not aware of that. Thanks for telling us this, Brian.
    I was just about to start paying down some delinquent articles on my credit report, but now I know better to just let them “fall off” and negotiate with the account holders (most of which are those bottom-feeders that buy off old charge-offs and try to collect what they can by sending scary letters to you.)

    How long does it take for a bankruptcy to drop off your credit report, and will it hinder me from getting a home loan if I manage to maintain good credit after the bankruptcy?

    • Credit.com

      Igby – Bankruptcies remain 7-10 years depending on the type of bankruptcy. Here’s an article that explains in detail:

      When Can I get A Bankruptcy Off My Credit Report?

      A bankruptcy doesn’t necessarily mean you won’t qualify or a mortgage loan. As you said, as long as you manage and begin building a solid history of good credit patterns after the bankruptcy, this will help tremendously. Obviously, the older the bankruptcy, the better. Someone that just filed bankruptcy in the last 12-24 months probably won’t qualify. However, if it’s further back and you’ve had time to rebuild your credit over the last several years, it shouldn’t hinder you from qualifying.

  • Amanda

    I’m working on rebuilding my credit after pretty much all of my accounts fell into collections and I defaulted on my student loans and had a couple of judgments against me. I have currently worked out a plan with my loan guarantor and collection agency to start making payments and get my student loans listed as being “paid as agreed” on my credit report. I figured my student loans were a good starting point given that they are a debt that never goes away. I’ve also been looking into opening a secured credit card because right now my credit report says I have no current credit, So I think I have a good starting point to repair my credit but I don’t know what to do about collection accounts. Is it better to pay them off especially smaller bills that I have or just let them eventually fall off my credit report which they will do in the next 4 or 5 years?

  • fred

    Im in deep. Over my head with student loans and loans and credict card debts. Not to think of TAXES. I do not know where to start. Any sugestions

    • Drew McNaabe

      Hey Fred, I’m going to be researching this one. Because my situation is similar. Some good advice on this article.
      I have been looking for work for almost 6 years. and living on credit cards, well over $40k.
      I put my student loan ($85k) on deferment. I had to drop after 1st year of grad school. Too much going on, no time to apply for jobs, end result, tough to focus. Hopefully taking courses over the summer could be a deferment in itself.
      Also my credit cards are nearly maxed out. One major card cut my credit line,so did another one but not before this idiot on high gives me unwanted credit counseling I did not ask for, then declines my request for balance transfer. This is not for frivolous luxuries. It’s for prescriptions, convenience checks for cash to pay mortgage and other bills. I have a game plan in place once I am working and stopping use of cards, and other ideas. What I can tell you is be PRO-ACTIVE. Contact your creditors before the past due notices. Tell them your hardship is temporary. What you are doing to get your debts down…short and long range plan. And get names of those you talk to. CYA. Paper trail.
      Let me know how things go!
      Good luck!

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  • http://credit.com steven Packer

    My question is if I have a $60k mortgage on a property only worth$45k I go to the bank get their ok for a short sale and the keep paying off the mortgage with sale proceeds and then keep paying my mortgage payment each monthly until it’s all paid in full problem? Thanks

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  • Suleyman Ahmed

    Until now i can’t to chek because the form is only for US Residents not is for global users and also i don’t have any credit cards to complete any payments inernationaly.

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  • Kate

    Hi can you tell me to build my credit? Am fresh credit I mean I have none credit ( just start)wanna get high credit score.what can I do?

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