Repairing a Damaged 570 Credit Score All the Way up to 820!

My original idea for this post was to find a few people with perfect 850 credit scores and interview them. I’m really curious to see what a “perfect” credit profile looks like!

But, while I was out searching for these folks, I stumbled across a whole range of people with really interesting backstories.

Here’s a note I received from a guy called Keith…

“I don’t have 850…but I do have 820-830 and 10 years ago it was 570. I made it my obsession to improve my credit…which I did.”

Whoa 😳 

Credit Score Ranges

Just for context, here are the ranges of credit scores all people fall into:

300-579: Poor (16% of people)

580-669: Fair (17% of people)

670-739: Good (21% of people)

740-799: Very good (25% of people)

800-850: Excellent (21% of people)

So Keith basically went from a “poor” —> “excellent” score. Talk about turning your financial life around!

I think a lot can be learned from people who have drastically improved their credit like this. It’s much harder to *fix* bad credit than it is to *maintain* already good credit. So today we’re going to dig deeper into Keith’s journey, and we’ll save the perfect profile interviews for another time!

This Guy Raised His Credit Score to Excellent From Poor

Here are some questions and conversations with Keith!

Joel: Dude, what an amazing transformation. I gotta hear more about your story! How did this all happen?

Keith: 12 years ago, as the great recession was getting underway, I had terrible financial habits. Bad habits in my 20s led to too much debt and no savings. I ended up with a credit score of 570 (that’s bad). I ended up losing my job and was forced to address my issues. I worked very hard to turn around my financial position. I started self-education on finances and credit scores and how they work. I am now a self proclaimed credit expert and I have maintained a 800+ credit score for several years (817 last time I checked). It took a lot of work, but it was worth it.

Joel: Sorry to bring up a sore subject, but how did your credit get so low in the first place? What got you in trouble?

Keith: I had excessive debt through my 20s – credit cards, car loans, boat loans, snowmobile loans. Even when I had the money, I wasn’t always the best at paying my payments on time, but most of it was fine when my income outpaced my debt. However, that ended in 2009 as the financial crisis took hold and I lost my job in the mortgage industry. By the end of 2009, my monthly spending was much higher than my monthly income…and that just isn’t sustainable. ☹ So, I started missing payments, mainly credit card payments – which just compounds the issue as you get hit with the $35 late payment fees. This is when my score was ~570.

It’s a terrible feeling when creditors call you. I now joke and say I have creditor PTSD because to this day if a random number shows up on my phone it can still take me right back to a time when it would bring me anxiety to see that.

Joel: Daaang, sorry to hear this. I can see how it doesn’t feel like a problem when you’ve got enough income to make payments… But when the income stops, that’s when the house of cards collapses! How’d you turn it around from there?

Keith: Debt is a massive weight and I was actually considering bankruptcy at the time. Around the end of 2009, I was talking with a customer at the bank I worked at. He was 22 years old and had himself in a great financial position. He recommended that I read Dave Ramsey’s book and the next time I saw him he gave me a copy of “Total Money Makeover.” That is basically how it all started. 

Once I read Dave Ramsey’s book, I had to read more. It eventually led me into the world financial blogs and of course FIRE blogs. Instead of bankruptcy, I made the decision to get myself out of the hole that I had put myself in.

Joel: I love that you decided to take ownership of the problem. I think many people try to hide from debt, and feel alone when they hit rock bottom. But, the truth is there are a ton of people around to help (like your customer) and free resources available to help make positive changes. So, what were your next moves?

Keith: I understood credit reports because of my job as a loan officer in a bank.  I knew how they calculate the score…payment history (35%), balance vs credit line (30%), credit history (15%), etc… It was frustrating that I knew exactly what caused bad credit, and I even consulted customers on how to improve their credit, while the entire time having my own bad credit and debt issues!

Once I made the decision to fix it, the first thing I did was cut up all my credit cards and set a goal to never miss another payment. That’s the most important piece of advice I can give — once you decide to fix your credit you have to make certain that you are always paying your bills on time.

What Determines Your FICO Credit Score?

Quick side note: Here’s a more detailed breakdown of how your FICO credit score gets calculated:

  • Payment history (35%): Making payments on time is the single most important factor when repairing credit. Lenders want to make sure you’re making payments on time, every time.
  • Balance owed vs. credit line (30%): Lenders look at your total available credit, and compare it to the amount you owe. For example: someone who owes $5,000 out of an available $10,000 credit line, this would show a 50% credit utilization. If another person owed $5,000 out of an available $20,000 credit line, this would be a 25% utilization. The lower the percentage you utilize of your available credit, the more positive your credit score will be.
  • Length of credit history (15%): Lenders want to know how long your good habits have lasted. Keeping old credit lines open can increase your credit score.
  • Credit mix (10%): You will appear more credible to a money lender if you can prove you can handle multiple types of credit. Home loans, car loans, credit cards, etc. **This does NOT mean you should go out and get a car loan just to show a good mix of credit.**
  • New credit lines/queries (10%): Building credit requires patience and a long-term outlook. Applying for too many loans all at once can harm your credit score.

How to Improve Your Credit Score

OK, back to Keith’s story…

Joel: What other major steps did you first take? How did they help?

Keith: For the first time in my adult life I created a budget and worked to understand exactly where my money was going – it was a total game changer. This goes hand-in-hand with my advice to make sure you pay your bills on time, using a monthly budget makes paying the bills much more manageable. Looking back, it seems insane that I was 29 years old before I created a budget! 

Cut up all the credit cards. My wife and I cut up nine credit cards in January of 2010 which at the time carried a balance of almost $17,000 with minimum payments of $565. If you have bad credit, you most likely have credit card debt… cut them up!

Using a monthly budget as our guide, we reduced our spending, and reduced debt. After I understood how I was spending my money, I worked to stop all excess spending. Then I started to focus on reducing my debt. I did this by selling everything that had a loan on it. By the end of 2010 (it took some time) I sold my truck, my two snowmobiles, and my boat. At the time, this accounted for about $18,000 in debt with a monthly bill of $610.

**Keith’s basic budget and expense tracking template is available to download here (Excel version) if you want to check it out!

Joel: This is great advice for others in heavy debt with bad credit. What other tips can you share to help someone who might be in the same spot as you were 10 years ago?

Keith: It can feel extremely depressing, frustrating, and humiliating to deal with financial issues. But you can fix this. Three steps you have to take right now:

  1. Again, if you have bad credit, there is a good chance that you are missing your required payments. The most important thing to do is create a monthly budget and understand exactly where your money is going. Most of the time, the main problem is debt — so make a solid plan to eliminate it. Pay your bills and kill the debt.
  2. Get a copy of your credit report and study it. How many debts do you have? Which ones are current? Are any in collections? Pay off your highest interest loans first (prioritize making ALL payments on time).
  3. Join a financial group, get help, and educate yourself. You are not alone and things will improve if you commit to making better choices.

Joel: What does your credit profile look like today? How many lines open, $ credit limits, is it a mix of types of credit?

Keith: We now have a very small credit profile. My wife and I have three accounts…we closed everything else. 

We have a mortgage.

We have one credit card that we are both on – a Southwest card that has a $22,000 limit. We went a long time (probably seven years) without using a credit card. We now use this one card on a monthly basis with the goal of collecting frequent flyer miles and it gets paid in full every billing period and never has a balance. 

My student loans from going back to school in 2010.

At the time of the financial crisis I was a loan officer in a bank – like I said…I didn’t make a lot of good decisions in my 20s. In 2010 I returned to school and finished my engineering degree. I graduated and have worked as a mechanical engineer since 2011. This would be the other big piece of advic:  work to increase your income, easier said than done…but it is worth it in the end.

I didn’t really mention FIRE…and now that we are 10 years into this financial journey FIRE is on the list, but it really took til year 4 or 5 to really start thinking about that. We continue to live by our monthly budget (still to this day) and 2020 was the first year we maxed out both my 401(k) and my wife’s IRA. She is currently a stay at home mom to our three small children…so we are doing this all on one income. If we stay on track, FIRE will be within reach in 8-10 yrs.

(Tourist selfie of wife and I at a WI state park (we live in WI and we camp a lot) but I thought it was fitting because our main source of family entertainment is camping – which is very budget-friendly. Unlike the old days of bars, restaurants and vacations we couldn’t afford. 😀)


Wow. From debt and bad credit to financially stable in 10 years… And then reaching financial independence in another 10 years.

I hope Keith’s story has inspired any of you out there with bad credit, heavy debt, or if you’ve recently lost your income. The covid pandemic has crushed many people’s financial situation, but Keith and his wife are living proof that rebuilding an excellent credit profile is absolutely possible!

Keith also has been slowly working on a side hustle the past 6 years… He recently launched a patented product designed to help ice fisherman store gear! Pretty cool, check it out here –> Could be a good Christmas present for your ice-fishing friends? ❄️ ⛸ 🎣 🐟

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  1. The Millennial Money Woman December 18, 2020 at 6:07 AM

    Keith and Joel –

    What a great story. Keith, I’m sorry to hear how you got into the credit card debt in the first place. You are not the only one – I’ve seen a few family friends go head over heels into credit card debt because they thought their relatively higher income meant they could spend at will not worry about making their credit card payments on time. Like you, they soon realized that missing credit card payments can figuratively kill your credit score.
    It’s really as simple as sticking to your budget and making your payments on time.

    Thank you so much for sharing your story.
    It truly was inspiring!


    1. Keith December 18, 2020 at 11:10 AM

      Thank you Fiona! I agree…budget, budget budget!!

    2. Joel December 18, 2020 at 2:54 PM

      It’s funny how a high income doesn’t solve basic financial bad habits. High incomes come and go – but little habits stick around. (forever if you don’t change them).

      Have a great weekend Fiona!

    3. Lucious December 19, 2020 at 9:34 AM

      I’ve been wanting to do a budget spreadsheet but honestly had no idea where to start, so I thank you for sharing your template. You mentioned FIRE in your interview, what does that mean?

      1. Joel December 19, 2020 at 1:34 PM

        Hi Lucious! FIRE is an acronym for Financial Independence / Retire Early. Financial Independence is achieved when you accumulate enough wealth in investments that you can live off it for the rest of your life. If you have great financial habits and start saving a lot at a young age, you could potential Retire Early in life.

        It’s important to note though – FIRE is actually more of a lifestyle, not just a final destination. Many people are decades away from retiring – and becoming financially stable can take many years of hard work, dedication and learning. Everyone in the community supports one another in this journey, to make sure we are all living our best lives no matter how much money we have, and that we’re all slowly making progress together.

        As for the budget template, I’m glad it helped! Please email me if you have any questions or need help. Budgeting is the cornerstone of good financial habits. :)

  2. SL December 18, 2020 at 8:32 AM

    I went from total bankruptcy in 2004 and high 500 range (not really sure, was generally too scared to look) to mid 700s in 2012 and low 800s by 2015. One help was the “vulture” credits cards one can get right after declaring bankruptcy. These are credit card offers sent to you in the first few months after bankruptcy declaration is completed. I applied for and accepted two with yearly fees and a rather high interest rate. I used them extensively for my monthly budgeted items and paid them off each month which negated any interest accrual. This gave high use and turn over and an extremely low ratio on credit I was using. The fee was worth it to start reestablishing a credit base..

    The rest was a strict budget, INCLUDING entertainment money. That is actually more important than many realize when firs fixing their credit. If there isn’t a pressure release or ‘reward system’ of some sort, the push for change in lifestyle is too hard, and old habits come back because “why bother.?”

    I signed up for free credit score watchers and followed them a lot. Each year I request a free report from the credit agencies (usually around my birthday so I remember).. I still do this especially because my personal information has been leaked by companies and government many times (yes, I am kind of unlucky that way). I check balances and transactions every couple of days, put almost nothing on autopay, so I actively know where my money is going and can watch for myself odd activity.

    It is hard, it is slow-going. and believe it or not, talking with your bank or credit union account advisors about trying to repair your credit can give you some great free insights. Letting them know you are serious and establishing a relationship will get your local branch on your side helping with repair. They want you to have great credit too so you place more money with them and get more loans when needed.

    1. Keith December 18, 2020 at 11:13 AM

      That’s great info! I personally stayed away from credit cards for a long time…but you do have to start somewhere.

    2. Joel December 18, 2020 at 2:57 PM

      Thank you for sharing. This is really good info. I can’t believe there are “vulture” companies out there that tempt people back into the cycle of credit cards. Wow. Congrats on sticking with your game plan and beating the system. I’m very impressed – you should be really proud of such a great recovery over the years. Congrats!

      Have a great weekend and thanks again for sharing your story! People need to hear more encouraging stuff like this! :)

  3. Angie Pannkuk December 18, 2020 at 10:07 AM

    Ugh! Even a 700 score alludes me. I was doing pretty good. However, I hit a major financial bump in early 2019 and couldn’t afford the $300 minimum payment on a credit card. I was late 3x which sent my score back 100 pts.

    I only have $3000 on my Discover card. I have a feeling even if I were to pay that off…my credit score would still not be 700. Oh well, I’ll just be like my dad and pay cash for everything (even houses).

    1. Keith December 18, 2020 at 11:15 AM

      Stick with it Angie! Payoff that card! You will recover quicker than you think…slow and steady wins the race.

      1. Otis Rogers December 19, 2020 at 10:36 AM

        August 2020 my score was 534. I found a book called Credit Secrets. I did everything the book said to do. December 2020 my score is now 654 with 3000 in available credit. I find it easy not to spend because the pandemic has all entertainment shut down in Michigan. So my utilization I keep at 3 percent the credit bureaus seem to love that and my score goes up by 24 points every month so far. Use the credit for leverage, 20 thousand available to you start a business. This is the information age this Apocalypse has shown me it’s time for self reliance, use the credit to create incomes. Peace and blessings on your credit journey

        1. Joel December 19, 2020 at 1:37 PM

          So glad to hear you’re making progress Otis. Cheers for the book recommendation – i’m glad your learning and hard work is paying off! Happy holidays to you and the family :)

        2. Nova March 26, 2021 at 9:42 AM

          What do you mean 3%???

    2. Joel December 18, 2020 at 2:52 PM

      You got this Angie!

  4. Ruby December 19, 2020 at 10:58 AM

    Can you remove chapter 7

    1. Joel December 19, 2020 at 1:23 PM

      Hi Ruby, Here’s what I found online regarding this…

      How Long Does Bankruptcy Stay on the Credit Report?
      The bankruptcy public record is deleted from the credit report either seven years or 10 years from the filing date of the bankruptcy, depending on the chapter you filed.

      – Chapter 13 bankruptcy is deleted seven years from the filing date because it requires at least a partial repayment of the debts you owe.
      – Chapter 7 bankruptcy is deleted 10 years from the filing date because none of the debt is repaid.

      1. Jason Babcock December 20, 2020 at 4:20 PM

        Thank you for your inspiration… It’s helpful to know how other people have faired in the journey… because I’ve studied so much about credit repair and do’s and ron’t’s.. I’m working with Lexington law to help me clean things up.. Any thoughts on this?

        1. Keith January 8, 2021 at 9:25 AM

          Sorry Jason – I didn’t work with anyone to improve my score. But i’m sure the same rules apply with or without help – stick to a budget and pay your bills on time. Easier said than done!

  5. Simone | our intentional farm December 19, 2020 at 3:51 PM

    Truly inspiring story. Congrats on your accomplishments Keith and thanks for spreading knowledge. Your FIRE goal is well within reach!

    1. Keith December 21, 2020 at 11:36 AM

      Thanks Simone!

  6. David @ Filled With Money December 19, 2020 at 6:14 PM

    People don’t realize how big of a component credit score is to acquiring more wealth and growing it. Happy to hear everything worked out and you’re on your way to have that elusive and perfect 850 credit score!

  7. Michael Parker December 19, 2020 at 11:11 PM

    I been working on my credit for a full year now i was in the 490’s & now im in the 620’s it takes time & paitence.Im hoping to be able to get a decent mortgage loan as my credit score continues to raise up in the summer of 2021.

    1. Joel December 20, 2020 at 2:17 AM

      Great job Michael. Stick with it!

  8. LENA December 20, 2020 at 3:40 AM

    Good story but didn’t mention how he dealt with late payments and collections if any. Did he wait for them to drop off? Did he dispute them and how? How long did it take for the bad items to disappear? These are things i and a lot of people want to know.

    1. Keith December 21, 2020 at 11:34 AM

      Hi LENA-

      I just waited for any issues to drop off. I didn’t really have a target timeline back then, I just started paying on time and waited for my score to improve. I don’t have exact dates, but I know that my credit was into the mid 700 by 2012. So two years later I had better scores. It goes faster than you think.

  9. Wilfried December 20, 2020 at 7:34 PM

    What a great post; thank you, Joel. You give excellent advice here; given the current economic situation, many people will need the guidance of your post, repairing their credit.

  10. Fico nudge December 21, 2020 at 12:36 AM

    What an inspiring story!!! Great work!!
    I am very curious about your original idea for this post. How to get to that 850. I am at 813 and it won’t budge! It’s not like I really need an 850 but I would love it. What are some tips at that point? Funny note my husband and I are house shopping and he got dinged for not having a mortgage! Come on FICO! We’re trying just need the right one!

  11. J December 21, 2020 at 3:14 PM

    This was a good story to highlight during this time period. I’m glad Keith could share his story for those who are in a similar position as he was in 2009. While I have not ever had a bad credit score, it was really hard to get my financial footing established back in 2001-2005 with no credit and a parent with REALLY bad credit. The college I went to was one of the few that wouldn’t really allow credit card companies to come on campus, either (that was for the best). I was eventually able to get a very low limit card ($500) from BOA after my boyfriend (now husband) added me as an authorized user to his credit card that he had for a few years. Once I had my foot in the credit door I decided to figure out how credit scores were determined so I wouldn’t have to fight so hard in the future. I wasn’t in the habit of spending money I didn’t have, so I would purposely make a purchase I was already planning on once I already had the money in my account using the new credit card. Then I would pay for that purchase in full. After about a year of that I would call up the company to ask to have my credit limit raised. That helped bring up my utilization score so that I could eventually be approved for other lines of credit it I needed or wanted them. I was able to get my score up into the 820-830 range over time.

    1. Joel December 21, 2020 at 8:30 PM

      That’s great J. I do agree that raising existing limits is a good way to modify the utilization. Some companies will do this without triggering new queries on your credit report and making you have a stronger score. Thanks for sharing! One thing’s for sure – building credit takes time and patience.

  12. mary pgi December 30, 2020 at 9:02 AM

    I totally agree. really inspiring story. thank you for sharing your knowledge!

  13. Dividend Power December 31, 2020 at 9:26 AM

    Good story. What most people don’t realize is the the FICO score is for lenders to determine if you are a good person to lend to.

    1. Keith January 8, 2021 at 9:37 AM

      This is a really good point. FICO puts everyone in “buckets”…i.e. how many lines of credit, what type of credit, balance, payment history…etc. And then your score is dictated by how all the other people in your “buckets” are likely to behave. For example: You have CC with a $5k limit, and you carry a $4,800 balance. Even if you always pay on time, and never miss a payment your score will STILL be dinged because similar people in that “high balance bucket” WILL miss payments – so now you are associated with them and your score is penalized. To Dividend Powers point, this is all so the bank can predict who is going to default. So, like my mom always said, be careful who you associate with.