Your Credit report paints a picture of your financial history by detailing your experience with credit cards, loans, and other financial vehicles.

Your credit score is a number that comes from the information in your credit report. Three different credit scores are available through Experian, Equifax, and Trans Union. Combined, they make up your FICO credit score.

What Does it All Mean?

Your credit score will come into play when you try to buy a car or a home, take out a loan, apply for a credit card, or apply for some jobs. Credit also plays a role in determining eligibility for renting a home or apartment. Your credit score must be “up to par”  for you to get by in life.

If your credit score is lower than required by a lender, bank, apartment complex, or employer, you may miss out on important opportunities. Luckily, there are ways to repair your credit in big ways with simple steps.

Use these strategies to improve your credit score:

1. Obtain your credit reports. You’re entitled to a free copy of each credit report once per year. You can obtain them through each of the credit bureaus individually or through their official website, annualcreditreport.com. Your credit reports offer a lengthy explanation of what is impacting your credit score so that you can make the necessary changes.
   • Your credit report will give you the information you need for each account you owe, including who you owe, how much you owe, and a snapshot of your payment history. Past credit accounts may also be included.
2. Obtain your credit scores. Your credit scores are numerical values placed on your credit history and can range between 350 and 850. Each credit bureau can have a unique score, but they’re combined to create a single FICO credit score. Obtain your credit score at least every six months to keep track of how it changes over time.
   • Obtaining your credit scores typically costs money, but can be done through each credit bureau individually.
3. Create a plan. Once you know what you’re up against, create a plan to help you deal with each record on your credit report. Address each record individually and develop a plan for repayment or dispute depending on the legitimacy of the debt.
4. Dispute incorrect information. If there are incorrect records in your credit report, dispute them. Dispute each one individually through the credit bureau or contact the creditor for more information on the debt. If the information is wrong, the credit bureau will make the necessary changes or removals. 
5. Pay off your debts. Pay each debt off one by one. You may wish to quickly eliminate your smallest debts first and then focus on the larger ones. Contact each creditor individually to come up with a repayment plan.
6. Follow up. Continue to check on your credit scores and reports, and follow up with creditors to keep track of your progress.
7. Pay your bills on time. This is one of the most significant ways you can improve your credit. Plus, you can start building good credit right away by paying this month’s bills on time. Make a plan and budget appropriately so you have the funds ordered to pay them before the due date.

Take small steps toward improving your credit for a big impact. The longer you have a positive credit experience, the higher your score will go. Work on repaying your debts over time and you’ll see your credit score rise along with your progress.