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A good credit score means lower interest rates – and monthly payments. That is why it’s worth the effort to check your credit score rating regularly, correct any inaccuracies that you find, and try to improve your rating – if you happen to have a bad credit score.

While there are certain things that can be done to improve your credit rankings, be aware of the various “fix my credit kits” that are mostly scams designed to take advantage of desperate people in difficult financial situation.

Myth: I can buy a kit to clean up my credit, and all my past problems will be washed away.

Truth: The only thing that can be removed – “cleaned” -  from your report are inaccuracies,so these kits are scams.

Remember this: nothing can be taken off your report unless the item is inaccurate. The Federal Fair Credit Reporting Act dictates how consumers and creditors interact with the credit bureaus. Bad credit drops off your credit report after seven years. If you have a Chapter 7 bankruptcy, it will stay there for ten years.

If you have an error to be corrected, take care of that yourself. Accurate bad credit stays on your report unless you lie. But lying for the purpose of getting money is a fraud, and you should NOT do it.

Credit-repair companies are mostly scams. The Federal Trade Commission regularly closes down these fraudulent operations. Some repair kits will tell you to dispute all bad credit and demand to have it removed, even if the item is reported accurately. Some kits even suggest you get a second identity and a new Social Security number. Do not fall a victim to such scams!

If you get a new identity, you get a brand-new credit report and lenders will not be able to find out about your past bad record. However, this is a fraud, and if you do this, you may go to jail.

5 Tips How to Improve A Bad Credit Rating

Here are 5 things that you can do to start improving your rating:

  1. opening a secured credit card – where your credit limit is the amount of money you deposit into your account
  2. take out an installment loan from your bank. By making the regular payments to the bank on time, you will be building good credit. To get the best rate, try credit unions and small, local banks. These institutions tend to be more competitive than larger banks.
  3. piggyback on someone else’s good credit. Ask a close friend or family member to allow you to become a certified user of a credit with them
  4. use store credit cards when you shop. However, be sure to pay off the balance in full each month!
  5. And most of all remember to pay your bills on time!

Work on cleaning your credit report and improving your relationship with money. Over time your credit report will clean itself.

But remember, improving credit scores takes time. He said scores do not always reflect an individual’s recent spending habits as the consumer has been working to pay down debt and improve his financial standing.  Credit scores really measure what you’ve done, not what you’re doing now, so they  may not show what you’re doing now to turn the ship around.

Read more about credit score rating and credit score ranges chart.