Your credit score is based on 5 major factors as shown here:

So, any fix credit score plan needs to address these 5 facets of your report. The first thing you need to do is get copies of all three of your credit reports from Equifax, TransUnion, and Experian. You are allowed one free credit score report per year from each of these companies. Each of these companies has their own FICO score for your credit report, so you have 3 different FICO scores. These FICO scores will not be available in your free credit report but you can pay an extra $20 to purchase them if you want. For our purposes here to establish a fix credit score plan of action, we can get all the information we need from the free versions so you don’t need to buy the FICO scores.

The first thing you need to do is examine all you credit reports for any errors. If you notice anything that is incorrectly reported on your credit report you should contact the credit reporting agency and ask to have the error removed. You will need to provide supporting documents, for example that you actually paid of a credit card debt and that no balance is due. Any mistakes that you found should be immediately addressed. You may some minor differences in each of your three credit reports and this is strange but completely normal.

OK now that any errors have been addressed, you need to start actively working on your fix credit score plan. As you can see from the pie chart above, the two areas that count for most of your credit score are the “payment history” category and the “amounts owed” category. These two sections alone count for 65% of your overall credit score, so this will be the main focus of our fix credit score plan.

The “payment history” category is exactly what you would think; it keeps track of all your late payments. Every late payment counts against your credit. This category keeps track of how many accounts are paid on time, how many are late, how late they are, how many have gone into collections, and whether you have filed bankruptcy. One or two late payments aren’t enough to sink your credit, but if you show a history of being consistently delinquent, this starts to look bad. This means that from now on, you need to pay every single bill on time. This is 35% of your credit score; it is unavoidable and not negotiable. The credit reporting agency doesn’t care if you were downsized, lost a paycheck because you were out with the flu or needed to replace your transmission. One thing you can do if you fear you will miss a payment or be late on a payment is to contact the company you owe money to and try to make an arrangement to skip a payment. A lot of companies have some leeway with this, it will usually cost you some extra interest, but it will avoid a bad mark on your credit.

The next major category “amounts owed” is based on how much credit you have available versus how much of your credit you are using. If you have $75,000 in credit available and have it all maxed out, this is not good. Someone with a lower credit limit of say $20,000 but with only $100 charged may actually be much better off credit-rating wise. This category also includes how much you owe on all your different types of accounts such as credit cards, mortgages, and personal loans. For example, secured loans such as those on real estate are expected to have a higher balance while a high credit card debt will reflect much more poorly on your score. So, what this means is that you need to dramatically reduce your overall debt, especially credit card debt and personal loan debt.

A lot of people are looking for a quick fix credit score solution, but I’m sorry to report no such solution exists. Quick fix credit score repair is a myth. The only way to repair your credit score is with slow deliberate action and to stop making the same mistakes that got you into trouble in the first place. If you follow just these two simple steps laid out here, pay all your bills on time and reduce your debt, you will able to raise your credit score. It won’t happen overnight, more like over the course of two to three years, but it will happen. You don’t get bad credit overnight and you don’t fix credit score problems overnight either.