The First Step to Credit Repair
You recently applied for a loan, and instead of a letter letting you know you were ready to proceed to the next step, you got a terse letter saying "Your application has been rejected because your credit score was too low." What on earth do you do now?
The first thing you must do to is find out exactly how low that credit score is, and why. Credit scores can be raised and lowered by a number of factors, but until you get a credit report, you won't even know where to start. Most individuals can now get their credit report for free once a year. Most credit reports will show your standing with the three main reporting companies, and the most recent inquiries into your credit standing. You may be surprised to see how many people have been checking your credit - companies from auto insurance providers to potential employers sometimes run credit checks.
Because of these diverse credit reporting uses, loans aren't the only reason to try and raise your score. You don't want to wonder if that interview which seemed to go so well flopped because your FICO score was crummy, or whether you're getting charged a higher rate to insure your stuff. Once you have your score in hand, you can try to figure out why it's lowered. Usually, inquiries alone aren't enough to significantly lower your score; odds are that there is another problem.
Obviously, you can scan for fraudulent accounts or the like yourself, and that should be your first step. Then, you can either start researching ways to raise your score, or find a company which specializes in credit repair or credit education. This is not a situation in which you want to rely on secondhand information "from a friend of a friend" or even from well-meaning relatives (unless they happen to be credit counselors or something). No credit score is irreparable; even bankruptcies drop off your record eventually. Work hard, don't be afraid to get professional help, and when your score improves, you'll get that letter saying "You've been approved."
