I Cannot Get My Credit Score Over 600

Reader Question: I went through an ugly divorce in 2004. I paid off all the debt in 2005, some of which were late payments. I have had credit cards, a home, car etc. since then with no late payments. But I cannot get my credit score over 600. I keep all of the credit cards below 20% of the limits. Any suggestions?

On the surface, it seems like you're doing everything you need to do to rebuild your credit score. I do have some suggestions and considerations for you though.

The first thing you should do -- if you haven't already -- is request copies of all three of your credit reports and read through them for accuracy. You are looking for several things here. First of all, you want to make sure there are no accounts showing up that aren't yours. Secondly, you want to make sure that your credit reports reflect the fact that you've paid your debts in full.

Here's the important thing about late payments and credit reports. Once it gets reported to the three reporting agencies, a late payment / default can stay on your credit report for up to seven years -- even if you eventually pay them off. So when reviewing your reports, it's the status of the account you want to look at. Even if the account is on there, the status should reflect your payment in full. If it still says "active" or "in collection" (or something similar), then you need to dispute it through the company that produced that report -- either TransUnion, Equifax or Experian.

You can also contact whomever you sent your final payment to (original creditor, collection agency, etc.) and tell them they need to update the status with the credit reporting bureau. Fortunately, the law is on your side in all of this. If you can prove that you've paid a debt, then the credit reporting bureaus are obligated to show this on your reports.

You seem to be doing well in the credit utilization department. This is the "Amount Owed" portion of the chart below, and it accounts for about 30% of your overall score. It wouldn't hurt to pay the balances down a bit more (every little bit helps), but being below 20% of the credit limit is pretty good. I don't see why that would be limiting your score.



While we're talking about this pie chart, it's worth noting that your payment history influences your credit score more than any other single item. So, even though you've paid those previously missed payments, they're still going to "ride" on your credit score until the seven-year point. And they're going to have an effect on your score. But again, you want to check your credit reports (all three of them) to make sure the status has been updated for those particular accounts. You want it to reflect the fact that you're all paid up.

There are a lot of variables here, many of which I don't know. So it's hard for me to offer any advice other than what I've written above. I hope this helps you, at least a little. Check out the related questions below for more information.

Related Q&A sessions:

• Will paying off bills raise my credit score?
• How do I increase my score as quickly as possible?