"I rented an apartment last year with a friend of mine, I did not receive any information on owing them money until a collection agency contacted me several months after I moved out. I am currently paying the collection agency every month until August. My question is how bad is this going to look on my credit report, and will it just go away after I complete payments, also what can I do to help my credit report if it is already low?"

Let me start by saying that unless the apartment complex actually reported something to the credit bureau, you likely don't have anything to worry about on your credit report. To make sure this is not a problem in the future make the payments they are asking for now on time and for the right amounts.

The fact that you were surprised by these payments being required is another issue. When you move out of a house or apartment that you are renting, it is of vital importance to make sure that damage and repair costs, along with security deposits are agreed upon, documented, and signed, and that you as the renter have a copy available in your records. If you had some documentation of the apartments' owners agreeing that you did not require any more payment or fees, you could have settled the issue in court rather quickly.

For the second part of your question, there are several ways of improving your credit score. For example, being a joint borrow on a car or other loan with a parent can ease you into an account of good standing. The credit union also allows you to take out a share loan against the money in your savings account. This type of loan does not require a joint borrower and will help to build your credit.

Be sure to get your free annual credit report, the Fair Credit Reporting Act (FCRA) requires each of the nationwide consumer reporting companies—Equifax, Experian, and TransUnion—to provide you with a free copy of your credit report, at your request, once every 12 months. Go to www.annualcreditreport.com for yours today!

Hope you found that information useful Scott, and I hope that some of you other readers learned something as well! Until next time!

Asked by Scott