If you are like most people, you worry about your credit score. If you have to file for bankruptcy, it may feel like you will have a low score going forward. The truth is that no matter the reason for your low score, you can rebuild it.
U.S. News explains that how you rebuild your score may depend on your starting part. If you have a relatively high score, it will take you less time to build it up.
Maintain a low balance
Sometimes, keeping a low balance on your credit cards is easier said than done. If you want to rebuild your credit, credit bureaus want to see your utilization ratio at 30% or less. For example, if you have a $10,000 credit limit, then you should owe no more than $3,000.
Stay up to date on bills
The most important step to take when building a credit score is to pay your bills on time. Being late on your credit card or loan payments can affect your score. 35% of your overall score takes your payments into account.
Borrow to pay back
Credit bureaus appreciate credit diversity. If you want to raise your credit score, then you have to prove that you are a good credit risk. If you have creditors willing to loan you money and then you pay that money back, you will see a steady rise in your overall score. You may want to have an installment loan and revolving credit.
Credit scores can fluctuate. No matter your situation or the hit to your credit, you can always build it again.