Start Repairing Your Credit Score in 4 Simple Steps

Two people reviewing papers together.

A good credit score can be key to achieving some of life’s biggest goals. High credit scores indicate to lenders that a borrower is likely to fulfill their financial obligations, which makes it easier to get approved for loans and credit cards and can lead to better loan rates and terms—making it easier and more affordable to meet goals, like buying a car or your first home.

On the other hand, a low credit score can reveal that someone has trouble repaying debts. People with lower credit scores may still be able to obtain loans for cars and houses, but they may get less favorable terms or pay higher interest rates. Some employers even check job candidates’ credit scores as a pre-employment screening, and landlords may also consider applicants’ credit scores when approving tenants.

If your credit isn’t where you’d like it to be, don’t be discouraged. There are some ways you can help to repair your credit score and take advantage of all the perks that come with a high score. (These suggestions can also apply to people who are just starting out and need to establish a credit history.)

1. Know Where You Stand
Before you start making moves to raise your credit score, you need to figure out what your current credit score is. The highest possible credit score is 850, but anything in the high 600s is generally considered good. Scores over 740 will usually help you qualify for the best rates.

You can request copies of your credit report for free each year from all three credit reporting agencies (Equifax®, Experian®, and TransUnion). These reports are available at, or you can call 1-877-322-8228. Be warned that other websites claiming to provide free credit scores may not be legitimate, or may try to sell you other services.

Examine each of your credit reports carefully, and make sure all the entries are accurate. If you notice errors on any of your reports, call the appropriate credit bureau to dispute them.

2. Pay All Your Bills on Time, All the Time
One of the most significant factors that determine your credit score is whether or not you pay your bills before they’re due. Late payments – even by only a day! – can ding your score, whereas a consistent history of on-time payments has a positive effect.

If you find yourself having a hard time figuring out how to make your payments, creating a budget can help. With online money management tools, you can create a budget that fits your finances, helping you to cut back on discretionary spending while you focus on repairing your credit.

If you need help remembering when each bill’s due date is, consider setting up automatic recurring bill payments in online banking.

3. Prioritize Paying Down Debt
A high credit utilization ratio, or the amount of credit you are using compared to your available credit limit, negatively impacts your score. Using less than a third of your available credit is ideal. To repair your credit score, focus on paying down your high-interest credit card balances first, to minimize your total interest payments.

If you have a lot of different cards with varying rates, consider consolidating your debt with a low-interest personal loan. Transferring your balance from a high-interest credit card to one with a competitive APR can also be a smart way to save money on interest as you work to pay down your balance.

4. Be Strategic About Applying for Credit
Every time you apply to borrow money, whether it’s a credit card, car or personal loan, or mortgage, the lender will pull your credit report in what is known as a “hard inquiry.” So even though you may be tempted to respond to the credit card offers you receive in the mail, don’t apply for financing unless you really need it and can manage the payments. These hard inquiries stay on your credit report for two years, so too many inquiries in a short time will delay your progress in building credit.

If you want to build up your credit with a credit card but don’t think you’ll qualify for one – either because of past credit issues or a limited credit history – try a secured credit card. These types of cards are ideal for helping people build or repair their credit. They’re easier to get, because you have to provide the lender with a deposit upfront to serve as collateral—reducing risk for the lender.

Paying your bills on time and sticking to your budget can be tough. Depending on your past credit use and how well you complete steps 2 and 3, it may take months or even years to improve your credit. But, we promise it will be well worth it in the long run.

We Can Help
As a not-for-profit financial institution, BluPeak Credit Union is here to help our members improve their financial well-being and achieve their goals. Whether you’re looking to get your finances back on track, or go after a big financial goal, we offer free financial education to support you along the way, including helpful webinars from our BluPeak Credit Union team about a variety of financial wellness topics.


All loans subject to credit approval. Must meet membership and account criteria. This information is provided for educational purposes only and is not intended to be financial advice.
Equifax is a registered trademark of Equifax Inc. Experian is a trademark of Experian and its affiliates.

You Might Also Be Interested In

Protect Your Plastic: Tips to Keep Your Cards Safe

There are two essential ways to avoid falling victim to theft, debit card fraud, and credit card fraud: Staying informed and taking steps to protect yourself. Read More

What to Know Before Getting a Credit Card

Read on to find out what you need to know before getting a credit card. Read More

How to Use Your First Credit Card Responsibly

Some people say “cash is king,” but carrying a lot of cash can be inconvenient and risky. A credit card is often safer and easier to carry. Plus, it can give you access to more money than will easily fit in your wallet. Read More