Therefore, having a low credit score can be like getting stuck in a vicious cycle – even things that you did wrong some time ago can remain on your credit report and thus adversely affect your score. And is there a possibility, which is still a question, to somehow clear the record and begin anew to build up a good credit score? No, it does not. Here’s why and what to do about it – understanding more about why your credit score follows you around, and how to rebuild it.
Why You Can’t Wipe Your Credit History Clean
Equifax, Experian, and Transunion are the credit reporting companies responsible for your credit reports and credit scores. These bureaus keep detailed records of your entire borrowing and repayment history, including:
- Any credit account, that has been opened at any given time whether it is still active or not.
- Account balances
- Whether the payments were being made on time or not
- Collections accounts
- Some people have been discharged from bankruptcy and sworn in as civil servants.
The information posted on your credit report remains there for about 7-10 years in most situations. The duration that any item stays on the credit report depends on the nature of the item- a payment that is made later can take 2 years, while a bankruptcy can take up to 10 years.
That means while this information is still active on your report, it’s included in the calculation of your credit score. It is legally impossible to remove accurate entries and details from credit reports. To challenge and delete the rightful data is wrong under the law.
Hence, one cannot expunge their credit score to a zero level unless one can prove some information as being incorrect or stale. In most cases, this credit history remains for many years and has a significant impact on their lives.
Fresh Start is Impossible
Credit bureaus have good reasons for holding full credit history for that long. Repayment history is still the most powerful means of testing how creditworthy people are in the future.
Applicants’ credit reports and scores are valuable for determining whether debtors are likely to pay back their loans responsibly. Erasing or excluding negative history would depict only a positive scenario which is unsafe since it makes lenders extend credit to those who are likely to repay via failing to pay.
People also need credit scores and histories to be wiped clean and restarted on their whims as well is also not good. For instance, a person can accumulate large sums of credit balances, and then erase them then begin with the new balance equal to zero. This will have negative impacts on credit reports and credit scores.
For these reasons, your credit score needs to consider all of your credit history until the credit bureaus are required by law to remove those items they have reported. The possibility of starting anew, of actually erasing the sin, is impossible in this context.
Here is how you can rebuild your credit instead:
Even though you cannot get rid of negative items before they naturally fall off your credit report, you can begin building a new and improved credit record at any time.
Here are the main steps to take:
- Make all future payments on time – prompt payment is the biggest contributor to your credit score. Set reminders if needed.
- Ensure that you do not overindulge yourself with credit card balances. High usage is not good for your FICO, therefore, balances should be paid off substantially.
Remember to keep credit accounts open if possible – paying your bills on time lowers your credit risk.
Diversify account types – holding installment loans and revolving accounts will do the credit.
Reduce requests for credit – multiple requests are seen as a sign of a higher risk and thus will reduce your rating.
Check your credit reports and correct the genuine mistakes – this should assist in enhancing the accuracy that is negatively impacting your credit score.
Reckless habits start to be leveled by responsible ones after a few years and the marks are already on the report. The score will increase gradually upwards as new positive information is included in the analysis. This is because • Reducing debts and mastering utilization normally helps scores bounce back quickly.
Do Not Be In A Rush When Repaying The Cards
The re-positioning exercise also requires time because one has to wait for the major negative to elapse after a 7-10-year cycle too. However, it is important to understand that it does not mean that you will never be able to have a good credit score due to the mistakes made in the past. When it comes to accident prevention, being responsible for your actions over time gradually causes the score to rise.
Although there is no magic cure for fixing credit problems and achieving a completely clean slate immediately, it is still achievable gradually. The secret is that one has to be patient and practice good financial behavior all the time. Being a good credit score, an accurate credit score may feel like punishment sometimes, but it acts as a shield for both the lenders and the consumers. Trying to manipulate or even try and eliminate your credit history is not feasible or practical. If anyone is willing to put in the work to rebuild instead then go for it!
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