How to Get Rid of Bad Credit: It Is Possible 

                            You can overcome your bad credit situation. It will take your time and effort but in the long run it will pay off.          First, call your credit card companies and try to get your card payments reduced, your interest rate lowered, or otherwise get some kind of payment breather. This frees up cash that can be used to pay down the debt balances. Take the same step with any personal loans, medical or dental bills, or store credit accounts.

Next, cancel or close as many cards as you can. Having fewer cards helps build your credit score. And lower balances, not being maxed out on any card, improves your credit score. By getting some concession from your credit card company, you'll have extra cash to put toward the principal each month instead of just making the minimum payment.

Third, try not to take the step of borrowing more money to pay off cards. This usually backfires, as the borrower pays off balances, leaves the card active, and continues to charge on the card that was supposed to be closed. Unless you are getting a good low interest deal, don't take this step unless you are committed to closing the credit card account immediately when you pay it off. You can also close an account that still has a balance; some card companies will then close the card automatically once the balance reaches zero.

Be careful using a new card with a lower, or zero interest rate, to transfer balances from an old card. That interest rate may only apply for the first few months of the card and then zoom up higher than your old card. You'll end up in a worse position.

Fourth, find a way to pay more than the minimum each month. List your credit cards and other debts in order of highest interest rate to lowest. Starting with the first card, figure out how much extra you can pay toward debt each month. For example if you're willing to skip a daily gourmet coffee drink, you can put the extra $25 a week toward your most pressing credit card account. This helps reduce the principal balance, reduces your interest, and gets the card paid off faster. In turn, your credit score starts to improve as well.

Last, don't take out any more credit cards! If your credit is so bad that you can't get approved, look at this as a blessing in disguise, because it will force you to live within your means. Once your credit cards are paid off, and you've learned to live on what you earn, your future will be brighter and less stressful.