Top 10 tactics to help you get rid of a bad credit record

The stigma of bankruptcy can be a major embarrassment. No matter how blemished your credit record is, here are thetop ten tactics to help you get rid of it.

Having bad credit means there is information on your credit record that indicates you have a negative financial history, including late payments, bounced checks, and more. Based on this history, you are given a score and this score represents your creditworthiness.

A negative credit score means it will be difficult for you to:

• Borrow, whether for a car, house, furniture, or other large items.
• Find a job in some industries, such as banking and investment management.
• Purchase a house.

Here's what you can do to improve your credit and regain the trust of financial institutions:

1. Open a savings account and consistently make deposits, even small amounts.
2. If you do not have the means to pay all your bills every month, ask a bankruptcy trustee what solutions are available to you. This can help you reduce your debt without declaring bankruptcy and starting over from scratch.
3. Maintain a steady job.
4. Maintain a place of permanent residence.
5. Always pay your bills on time.
6. Try to pay down credit card balances each month or keep the lowest balance possible, ideally less than 50% of the limit.
7. Limit yourself to just one credit card with a reasonable limit.
8. Do not apply for credit regularly. Multiple applications for credit affect your file in a negative way.
9. Ask for a copy of your credit report and make sure it is accurate and contains no errors. If there are any errors, you can contact a credit reporting agency to make the necessary corrections.
10. If you declared bankruptcy but have no debt and have been denied a traditional credit card, apply for a guaranteed secured credit card so there is at least one credit activity on file. If you use secured credit cards appropriately, this will help you restore your financial profile. Furthermore, absence of any credit activity or having no credit at all is just as bad as having poor credit.

Credit reporting agencies provide credit reports to Canadians free of charge. They are merely information centres. They have no power to modify your file or change your score, apart from correcting errors.Credit reporting agencies transmit your credit information to any person or company who has your permission to access it.

The only way to improve your credit record is to practice good financial habits moving forward, so that future credit information is positive. Only time (usually six years) can erase negative data from your file.

Beware of any company offering to higher your credit score. They will charge you hourly rates and exorbitant fees to hand you the exact same information free credit reporting agencies provide, and nothing more.