3 Mistakes People with Poor Credit Scores Always Make

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2. Paying Your Bills Late

Another important factor that determines your credit rating is your payment history. It makes up as much as 35% of your score. If you’ve ever made a late payment your credit score might read ‘delinquent’. This can come from late student loan payments, credit card debt or even utility bills.

The Solution: Always pay your bills on time, and decrease them if possible. If you struggle to pay your bills, there are ways to reduce them. By switching to a different provider or asking for a discount, you could save thousands every year.

You can also let the app, Trim, do it for you. Trim figures out where you are spending and wasting money, and will even negotiate your bills with companies like Comcast, Time Warner, Charter, and others. It’ll also cancel recurring subscriptions that you forgot you signed up for.

3. Having Accounts in Collections

59% of CreditSesame members with poor credit scores have accounts with “derogatory” status. This means that one or more of their accounts is in collections, bankruptcy, tax liens or something else. These black marks can stay on your credit report for seven years, so even once you get your act together it can be a long time before you see your credit score improve.

The Solution: Sometimes you can get these derogatory marks removed from your report early. You can appeal directly to the credit agency and ask them to be removed. If you’ve just got one bad mark, a letter explaining the circumstances might be enough to see it taken off your report. This won’t always work, but there is no harm in trying.

In addition to this, in 2013 it was found that 1 in 5 people had errors on their credit report. If you spot something on your report that you think is a mistake, you can dispute it with the appropriate credit bureau. This will be Equifax, TransUnion or Experian. Each company has dispute forms on their website that you can fill out to rectify the situation. Maybe, an excellent credit score isn’t so far from your reach after all.