If you?re trying to build or repair your credit history, you have a daunting but not impossible task in front of you. Lots of people have been where you are and today they have good credit. With time, discipline, hard work, and by taking the proper steps, you?ll be able to build a good credit history too.

To build or rebuild your credit history you need to take certain steps:

Develop a budget and live by it. Whether your building credit for the first time or rebuilding credit, you need to know how much money you have coming in each month and how you?re spending it.

Start by listing your income from all sources. Next list all fixed expenses (rent, mortgage, car payments?). Finally list all of your variable expenses (entertainment, recreation, clothing?) no matter how small they are. Writing down and tracking your expenses will help you to understand your spending patterns and you?ll be able to see where you can save money by making lifestyle changes.

Open a checking account and use it responsibly. Lenders want to know that you have a relationship with a financial institution and that you have a checking account available to pay your bills. Don?t overdraw your bank account; in addition to possible damaging your credit record, you?ll be charged fees.

Pay your current bills on-time and pay them in full. Paying your bill on-time puts positive information on your credit record. Late payments or missed payments count against you.

Review your credit report annually. Contact Equifax, Experian, and Trans Union to get copies of your credit report. You should get a copy of your credit report from all three reporting agencies because some creditors don?t report to all three agencies. If you?re a member of a credit union, check to see if your credit union offers discounted credit report ordering for its members.

Fix any errors on your credit report. If you find errors on your credit report, contact the credit reporting agency and the creditor (in writing) to get the errors fixed. Check your credit report to make sure that negative information like late payments, delinquencies, liens, and judgments against you have been removed after 7 years; bankruptcies should be removed after ten years.

For more information on how to dispute errors on your credit report, visit the Federal Trade Commission website at: http://www.ftc.gov/bcp/conline/pubs/credit/crdtdis.htm.

Apply for a credit card. If you?re rebuilding your credit history, consider applying for a secured credit card. To get a secured credit card, you?ll need to deposit funds with the credit card issuer and your credit limit is usually equal to the amount you deposit. A secured card can be used the same way as an unsecured card and your timely payments will help to improve your credit history.

Apply for a department store or gasoline card. These cards are usually easier to get than major credit cards and they come with smaller credit limits.

Establish an account at a credit union and take a loan out on it. This is a secured loan. You?ll have to pay interest on the loan, but if your payments are reported to the credit bureaus, the small interest fees will be worth the positive information that is added to your credit record.

Don?t max out your credit cards. Maxing out your credit cards can hurt your credit score. Try not to use more than 30% of the credit you have available to you. Part of your credit score measures the amount of credit that your have available to you and how much you?re using. The more credit you?re using, the more negative impact on your credit score.

If you get into trouble with your credit, get help. Don?t wait until creditors send your accounts to debt collectors. If you can?t make a payment contact the creditor and make arrangements to make the payment. If you feel that you?re over your head in debt get help from a debt counselor.

You can contact Equifax, Experian, and Trans Union at:

Equifax: www.equifax.com/

Experian: www.experian.com/

Trans Union: www.tuc.com/