It takes several months of consistently making smart financial decisions to build good credit. But it takes just one mistake or missed payment to damage your credit. More than one mistake and your credit score can plummet. Fortunately, there are get your credit to good standing again. It takes time and persistence but you can do it.

Here’s how to rebuild your credit after damage.

Make All Payments On Time

Make all credit card, loan and mortgage payments on time every month. Payment history has the biggest impact on your credit score. Every payment made on time will add a few points to your score. Consistent timely payments are the fastest way to boost your credit score. Even one late payment can hurt your score and stay on your report for up to seven years. That’s bad news at any time but more so when you’re trying to rebuild your credit after damage.

Use these two strategies to ensure that payments go out on time every time:

1. If you tend to forget deadlines, set up automatic payments through your bank. With auto-payments, the money gets transferred directly from your account on a set date. This ensures that all payments go out on time and you aren’t ever late with any payments. As an added bonus, most lenders will give you a rate reduction when you set up auto payments.
2. If you’re not sure about maintaining sufficient balance in your account for the payments, consider setting up payment reminders. Use whatever strategy works best for you, whether it’s a phone or email reminder or a wall calendar with the deadline highlighted.

Try Not To Max Your Credit Limit

Your credit card has a credit limit that determines the maximum you can spend on purchases or payments in one billing cycle. The credit card issuer allows you to use up to your credit limit. However, the amount you use can impact your credit score. Credit utilization is one of the factors that goes into calculating your credit score. It has the second biggest impact on your score – second only to payment history.

Credit utilization refers to the percentage of your credit limit that you’re using. Using only a small percentage of your credit limit every month indicates that you’re financially self-sufficient. You don’t really need the extra credit to cover your everyday expenses. Every time your credit card issuer reports a lower credit utilization ratio to the credit bureaus, your score gets a boost. Experts recommend keeping your credit utilization ratio at 30% or lower. Keeping your credit utilization as low as possible is a powerful way to rebuild your credit after damage.

Use these tips to keep your credit utilization ratio low:

• Pay down credit card balances – Instead of paying your credit card bills once a month, pay them twice a month. This can be especially beneficial if you regularly reach your credit limit every limit. Paying twice a month lowers the overall balance, which is good for your credit score.
• Ask for a credit limit increase – If you’ve been making your payments on time, some card issuers may agree to increase your credit limit. Just having the extra credit will low your credit utilization instantly. However, you must be careful not to misuse the additional credit.
• Keep old accounts open – The more accounts you have open, the higher your total available credit. The higher your available credit, the lower your utilization ratio, which is good for your score. Make sure you’re not paying to keep accounts open unnecessarily.

Get A Secured Credit Card

Using a credit card is one of the best ways to rebuild credit after damage. However, your damaged credit may prevent you from qualifying for a regular credit card. If you find yourself in this Catch-22 situation, a secured credit card can help.

A secured credit card is different from a regular credit card. With a secured credit card, you need to make an upfront deposit. The bank then issues you a secured credit card against this deposit. The deposit that you’ve made acts as your credit limit.

With a secured credit card you are in fact borrowing against your own money. So why bother with getting a card in the first place? Why not just use the cash for purchases? Because when you spend cash it doesn’t get reported to the bureaus so you don’t get any credit building benefits. On the other hand, payments on your secured credit card get reported to the bureaus. Timely payments will add points to your score, helping you rebuild credit after damage.

Report Your Rent Payments

Lenders report mortgage payments to the credit bureaus. These payments are taken into consideration when calculating credit scores. This is where renters traditionally lose out because landlords don’t typically report rent payments. When you’re trying to rebuild your credit after damage, every little bit helps. You cannot report your own rent payments to the credit bureaus but your landlord can. All you need to do is ask them. When reported to the bureaus, timely rent payments can help rebuild credit after damage.

How Long Does It Take To Rebuild Credit After Damage?

The truth is, rebuilding credit after damage takes time. Not matter how much you want it to, your credit won’t improve overnight. Negative information stays on your credit report for seven years. Erasing that information and re-establishing your credit standing takes time but it can be done. What’s important is to start your rebuilding efforts right away and stay committed to it. Put measures in place to prevent any more lapses, oversights, or mistakes that could damage your credit even more. Being consistent in your efforts to rebuild your credit after damage will eventually pay off.