I haven't used any credit since being in a car accident in '02 and this has damaged my credit score. What can I do to get my credit rating back?
Answers | 1
It will take a while (particularly if there are any remaining derogatory items on your credit report, but you can build a new/better credit score, even after years with no credit. The first place to start is with a secured credit card (M/C or Visa). Ask your bank if they offer these, if not there are plenty of options online. With a secure card, you give the bank a deposit (often $500), and in return they give you a credit card with a similar credit limit. You want to use the card sparingly, but monthly for a purchase or two, and then pay it off at or well before the due date. The account will report on your credit, and over time will help your scores. I've had some clients actually do 2 secured cards, certainly no harm in doing that if you wanted. You could also ask your bank about installment loans (secured or not). The credit scoring models like to see a variety of accounts, so your scores will increase faster if you have current installment and revolving debt activity. It doesn't happen overnight, but eventually you will build up the positive credit and your scores.. You can also pull a free copy of your credit report (once per year, per credit bureau) at annualcreditreport.com which is a government sponsored website, unlike many other advertised options. The reports won't include your credit score, but you can at least see if there are any old negative items, and view the new, positive accounts when they start reporting, typically a few months after the accounts are opened, Hope that helps! Ted