Many people are under the impression that once they fix (or remove) all of the bad records from their credit report (such as charge offs and late payments), they will have good credit. While ridding oneself of negative credit report records may relieve a great burden, the truth is, until you have gained sincere, long-lasting positive accounts on your credit report, your credit will never be “good” –it will simply be static and hover around 620 – 650. Therefore, an important step in credit repair is building NEW credit.

My mistake, of course, was that I went a little mad and applied for too much credit, too quickly. In my previous article regarding how credit inquiries can lower your credit score, I illustrated how this can damage not only your current credit score, but also your ability to obtain new credit. I also mentioned that it’s a good idea to apply for new credit in “bursts”. While this is absolutely true in order to minimize lowering your credit score due to too many inquires (inquires within a 2-week period are counted as one), it does little good if you already have a sour credit. This is true because you have to slowly build the creditor’s confidence.

Applying for multiple credit accounts right after you have cleaned up your credit report will do little good because creditors want to see previous positive accounts. Therefore, you must begin with one credit account (such as a credit card for people with bad credit), keep it for 6 months to get some positive history, and then apply for more credit. This is how to successfully build positive credit history and ultimately increase your credit score.

This may seem ridiculously obvious to you, but trust me, once your credit score begins to improve, you will be presented with an unfathomable urge to apply for more credit. This will hurt you in the end. Get a secured credit card, keep it for 6 months, and then start applying for a “real” credit card.