“Dear Steve,

I’m 35, new dad, have a terrible credit score(in the 400s), want to improve my score for a better quality of life, and most of my debts are 8 years and older.

I want to find specific information on how to remove old debts from my credit report. (ex. To whom do I write my letters? What should my letters say? What exactly should I do, step by step?)

Most of my debts are over 7 years old and include cell phone bills, appliance store credit, medical bills etc. . Thank you in advance for your help. I look forward to improving my life, with your help.

Chris”

Dear Chris,

Thanks for writing me for help. And if you follow what I’m about to tell you this nightmare will be over soon and you can put this period of financial mess behind you. In fact after my own bankruptcy this is the process I used and it worked perfectly to rebuild my credit quickly.

Step 1 – Get a Copy of Your Consolidated Credit Report

Get a copy of your consolidated credit report. It is the type of report that includes all the major three credit reports in one report. I only use a consolidated credit report to check my credit and the link will take you to the credit report I use.

Your credit report is like a report card of sorts. You need to look it over and make sure that all the accounts listed on your credit report are yours. If they were not, you need to write to the credit bureaus that are reporting them and tell them they are not your and ask to have them removed. It’s like you looked at your school report card and it listed classes you did not take. They should not be there.

If the rest of the accounts belonged to you but you had a bad track record with them, that information stays on the report just as if you got a D in a class you took. Just because you got a bad grade does not mean the class is removed from a report card.

After seven years the bad credit items will no longer be reported on your credit report. When you look at your consolidated credit report if any of them list negative information longer than the seven year period, then when you write to the credit bureaus to point out any incorrect information, you can tell them about the old items.

Generally the credit bureaus are good about automatically removing the old items.

While you are at it, look for any delinquent accounts that may be younger than seven years old. If you have any, pay them off. The contact information for the creditor will be on your credit report.

Step 2 – Boosting Your Credit Score With Good Credit Using a Secured Card

Using the report card analogy, if you wanted to bring up your GPA you would need to earn some better grades to do it. It is the same with your credit report. If you want to bring your score up you need to start having new and good credit reported about you.

The best way to do this is to get and use a secured credit card. In fact get two different ones.

The advantage of getting a secured card is that you will get the credit card and not get a rejection on your credit report that will further hurt your credit. A rejection can be easily spotted by looking at the inquiry section of your credit report and seeing there is not a corresponding card opened. And with your current bad credit, if you applied for an unsecured card, you would get rejected.

The reason you will get the secured credit card on the first attempt is because you need to put up a deposit with the bank that is equal to your credit limit. The deposit will earn you interest and in the unfortunate event you were unable to pay your card and defaulted, the bank would use your deposit to pay the debt.

When looking for a secured card you want one that will report to all three credit bureaus. This is key. We need your new good payment history reported.

Now when I say use the card, you do not need to carry a balance from month to month. Just use the card for regular purchases and pay the card off either immediately or at the end of the month.

Also, if you get a secured card with a $300 limit, never have more than 35% of the limit on the card. Even though your initial limits may be low, you don’t want to max them out. You can always increase your limits by increasing your deposits. You can increase your credit limit by increasing your deposit with the card company.

I suggest getting more than one card so you can get as much good juice flowing to your credit report without having too many credit cards open. You could actually go with three if you wanted to, but no more than that.

Step 3 – Enjoy Your New Legally Rebuilt Credit

If you follow these steps now in a year you’ll feel better about yourself and you’ll have substantially better credit. If you don’t want to follow these simple steps, Chris, do it for your child.

To keep your score growing just make all your future payments on time and avoid defaulting again.

Many people who have lived through a period of bad credit are often credit shy, me included. For them, credit equals pain. So what they do is avoid getting any new credit. But this only prevents them from bringing up their grade point average.

Please update me on your progress by

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