Credit 4

📚 Module 4: Rebuilding and Boosting Credit After Disputes

"Strengthening Your Profile"

Welcome to Module 4
Now that you know how to correct errors, it’s time to shift into the next phase:

Building strong, positive credit that grows your scores and protects your financial future.

Remember:
👉🏽 Removing negative items is only half the battle.
👉🏽 You must also add positive history to see major, lasting improvements.

Let’s get started.

🧠 Main Teaching Points

1. Why Rebuilding Matters After Disputes

Even if you successfully remove negative accounts, your credit score won’t skyrocket unless you build new positive credit.

Credit scores reward:

• Active, open accounts being managed well
• Consistent on-time payments
• Responsible credit use over time

Student Tip:
✅ Think of your credit profile like a garden — you have to plant new seeds after pulling weeds.

2. How to Rebuild Positive Credit

Here are practical ways to start adding positive history:

Method	What It Does	Examples
Secured Credit Card	Builds payment history safely	Discover IT Secured, Capital One Secured
Credit Builder Loan	Adds installment account to mix	Self Financial, Credit Strong
Authorized User	Boosts age of credit & payment history	Trusted family or friend’s account
Store Credit Card	Easier approval, builds new history	Amazon, Walmart, Fingerhut

Important:
✅ Only open what you can manage responsibly.
✅ Pay in full every month when possible.

3. Managing Utilization Wisely

Credit Utilization Rule:

• Keep balances under 10%–30% of the credit limit.

Example:
If you have a $1,000 credit limit, never let your balance go over $300 — and ideally keep it closer to $100.

Why it Matters:
Utilization has a huge impact on 30% of your score.

Student Tip:
✅ Make multiple small payments a month (called "credit card cycling") to keep reported balances low.

4. Creating a Payment History You Can Trust

• Set up automatic payments or reminders.
• Even $5-$10 minimum payments on time are better than missed payments.
• Late payments hurt your score immediately — and stay on reports for up to 7 years.

Student Tip:
✅ Always pay at least the minimum by the due date —never miss a payment again.

5. Handling Collections and Old Accounts

If any collections remain:

• Negotiate a "pay for delete" agreement where possible.
• If paying, get all terms in writing first — never verbal agreements only.
• Keep records of payments forever (receipts, confirmations).

Old Good Accounts:
✅ Keep old positive accounts open as long as possible — credit age helps your scores!

🎯 Lesson Recap

👉🏽 Disputes clean the ground.
👉🏽 Rebuilding plants the seeds of credit success.
👉🏽 Managing wisely grows your scores higher over time.

Strong, consistent credit behavior builds trust — with lenders, businesses, and future opportunities.

✅Next Up:
Advanced Credit Situations and Legal Escalations —
You’ll learn what to do when normal disputes aren't enough.