Settling With Former Creditors For A Lower Amount Whenever a person settles his or her former debt with a former creditor at a much lesser amount, this actually does more damage to your credit score. Because you ve settled with your former creditor for an amount less than what you actually owe them, the creditor eventually reports the remaining balance which you weren t able to pay, to the credit reporting agencies, and this will get noted in your credit report as a deficiency balance . Today, a number of accredited credit bureaus gather and sell credit information, which are often stored in large databases, where prospective lenders, employers, insurers, government agencies, courts, and even landlords can easily open up and take a look at their client s files. An individual can also get his or her own credit report from major credit agencies like Experian, Equifax, TransUnion and other small companies that serve regional or local markets. You can easily get different quotes from banks and financial institutions, and you can easily compare figures, to determine which creditor offers the most convincing terms and conditions. Put Your Other Creditors On Hold If you re in a financial crisis, it would help if you call some of your creditors, and negotiate If you may be able to put on hold some of your payments. When Making Inquiries, Check Your Credit Report With A Fine Comb According to most credit experts, a lot of people often check out their credit report every month. However, the sad thing is that whenever they check the report, they don't look at the finer details, and usually don't check the report for any errors, or any inconsistencies and flaws in the data entered. Next, don't open any extra credit card accounts, because by having an extra credit card, or by canceling the other one, you can do major damage to your credit history. Also ensure that you don't transfer your balance from a card that offers high interest, to a card that offers a lower interest rate. Pay-Off A Sizable Amount of Your Current Debts In order to build a good credit score, pay-off a sizable portion of your current debt load, since the more available credit you have, the more will your credit rating improve. Should you spot any inconsistency or discrepancy in your report, this should be removed or erased immediately. Keep Off Any Overdraft Fees To steer clear of overdraft fees, always make it a habit to balance your checkbook against your monthly statements, and always keep records of the items you purchase, or the services you ve availed of.