9 Ways to Rebuild Credit

Maintaining a strong credit history is something everyone needs to do. But understanding what may help build credit – and what could hurt it – is a bit less universal. What can make it even harder is a situation like a job loss or a medical emergency, which may cause you to fall behind on your bills and, as a result, damage your credit health. It can happen to the best of us, but the good news is that you can rebuild your credit and recover. These credit strengthening tips may help, whether you're striving to get back on course or just want ways to help your credit and to keep a good track record going.

1. Pay Your Bills on Time

Paying your bills on time is one of the most important ways to rebuild your credit. Since credit scores track your payment history, they will track how often you pay your credit card balances and other loans. Start rebuilding your credit by making these payments as soon and as consistently as you can.

2. Consider a Secured Credit Card

If you’re having difficulty getting approved for more conventional credit cards, you may be able to use a secured credit card to start building your credit. These cards will need a security deposit to start using them. If you can provide this, you may be able to start rebuilding your credit with a secured card.

3. Review Your Credit Report

It’s a good idea to obtain a copy of your credit report and examine it for any unexpected loan history or potential errors. You can find your credit report through one of the major credit reporting companies.

Once you’ve found your credit report, you’ll want to look and see if there are loans that might still be on your record and need addressing. You’ll also want to look and see if there are any mistakes in reporting your credit history, such as loans you’ve never taken out or fraudulent credit card usage.

4. Keep an Eye on Credit Utilization Ratio

Your credit utilization ratio calculates how much of your available credit you use at any given time. This ratio can play an important part in your credit score, so it’s important that you monitor it and keep it low. Some credit scoring companies recommend keeping this ratio below 30%.

5. Consolidate with a balance transfer or loan

Debt consolidation is another good way to start rebuilding your credit. For this method, you may be able to use a balance transfer credit card, or possibly a debt consolidation loan for outstanding loans you might have.

While consolidating debt itself doesn’t rebuild your credit, it may make your debts easier to repay and allow you more flexibility in paying them off over time.

6. Become an Authorized User

Another way to rebuild credit is to become an authorized user on a card with a history of timely payments and a high credit limit. When you do this, you may be able to improve your credit utilization and build your credit history.

While this isn’t a catch-all solution, it can play a part of a larger strategy in rebuilding your credit.

7. Ask for Higher Credit Limits

Many credit cards offer you the ability to ask for a credit limit increase. To do this, visit your issuer’s website or mobile app and learn the steps to asking for a credit limit increase.

When you increase your credit limit but keep the same spending habits on a credit card, you use less available credit and decrease your credit utilization. In turn, this may improve your credit score.

8. Catch Up on Overdue Bills

If you have any overdue payments on credit cards or other loans, you’ll want to develop a strategy toward paying these as soon as possible and making future payments on time. Late payments generally stay on credit reports for up to seven years, so this should be one of the first steps you take in rebuilding your credit.

9. Add to your Credit Mix

Your credit mix measures the different types of credit accounts you have. When lenders consider approving you for credit, they like to know that you’ve handled a variety of different loans responsibly over time, so credit scores typically factor in the diversity of your credit accounts when determining your score.

Because of this, taking out different types of loans and repaying them on time may help you rebuild your credit over time.

Citi Credit Cards that May Help Rebuild Credit

Credit cards that offer low or 0% intro APR on purchases, balance transfers, or both – such as the Citi® Diamond Preferred® CardCiti Simplicity® Card, and Citi Custom CashSM Card – may be good options to help rebuild your credit.

Although minimum payments still need to be paid on time to keep the introductory APR and, for balance transfers, transaction fees can still apply, taking advantage of low or no interest rates for an introductory period can give you more flexibility to start rebuilding your credit in a convenient manner.

Rebuilding Credit - Frequently Asked Questions

How long does it take to rebuild credit?

The time it takes to rebuild your credit will depend on your current financial situation and your credit history. Missing several recent payments, for example, is different than missing a single payment farther back in your payment history.

How can I rebuild my credit fast?

There is no surefire way to rebuild your credit fast. Once you take the proper steps to address any issues in your payment history, credit utilization, or credit mix, you should start to see your credit improve over time.

If I’ve made late payments, how long does it take to rebuild my credit?

Although a firm date can’t be attached to when you can rebuild your credit, late payments generally stay on your credit report for up to seven years. If you haven’t already, you should focus on paying these debts and consistently make new payments on time.

Disclosure: This article is for educational purposes. It is not intended to provide legal, investment, or financial advice and is not a substitute for professional advice. It does not indicate the availability of any Citi product or service. For advice about your specific circumstances, you should consult a qualified professional.

Additional Resources

Utilize these resources to help you assess your current finances & plan for the future.

Learn how FICO® Scores are determined, why they matter and more.

Review financial terms & definitions to help you better understand credit & finances.