Creditors are in business because they earn a profit from their lending services, and if you don t pay your debts, the creditor will also feel the pinch, and his bottom line gets hurt as well. It would be better if you sit down and negotiate with your creditors, since most of them are willing to understand your difficult financial condition, and may be more than willing to offer an easy way out of your financial mess. Some creditors have been known to look at their customer's bill payment records, so that they can establish your willingness to pay. Get Installment Loans Next, get an installment loan, such as a car or appliance loan. This can be a nice start towards rebuilding your credit score. Once you've gotten approval, pay off the loan in the quickest time possible. Avoid Getting Extra Credit Cards If you can live with just one credit card, then by all means remain happy with only one card at your disposal. Avoid signing-up for the various credit card offerings you receive in the mail, as well as from the department store or mall clerks who want you to sign up for store discount cards. Ensure that you pay your library fines or parking tickets on time, because you won't know when they send these bills to the collection agencies. While late credit card payments, or mounting medical bills and unpaid parking tickets may seem like small bumps on the credit highway, these actually help to slowly mangle your credit rating, and may significantly alter your plans of buying a new home, getting a new car, or paying for your child's college tuition. Basic Overview Of Credit Score Ranges A person s credit report is essentially an ongoing look at his or her personal information, and provides a deeper insight on how well the individual manages his or her finances, and pays their debts. The individual s financial data is submitted to a credit reporting agency by creditors, debt collection agencies, the courts and other public or federal agencies. As most of the data here is self-reported, the business owner must always make sure that the data filled in is accurate and updated. Credit Rating Determine if your credit rating is poor, average or strong. Because credit reporting firms and agencies often use different scoring methods, some of the ratings may not be the same.