Many people find themselves having to deal with bad credit due to the downturn of the economy, the rise of the cost of living, as well as the increase in layoffs. These tips can help you gain insight on how you can get a better credit score.
When trying to improve bad credit, beware of companies who promise that they can erase any negative, but correct items, on your credit report. If the information is correct, it will remain as part of your report, in most cases, for seven years. However, information that is not correct can be removed.
When starting to repair your credit, pay your bill on time from now on. Not only must bills be paid, but they must also be paid in full and in a timely manner. When you pay off past due lines of credit your credit score will go up.
When you are trying to clear up your credit contact your credit companies. Avoid collection to improve your credit score. Credit card agents may have the authority to eliminate monthly charges, extend your due date or change your billing cycle.
Ask credit companies to lower all of your card limits. Doing this keeps you from overtaxing yourself. It also shows the lending company that you are responsible.
Read your negative reports carefully when attempting to rebuild your credit. Even if the negative report is true, if you can locate an error in the report, it may be possible to get it removed.
Credit Card Balances
To fix damaged credit, pay off your credit card balances as fast as you can. Always pay off the card with the highest interest rate first and then work you way down. Beginning to pay your credit card balances off will show creditors that you are making a valiant effort and are credit worthy.
Only work with legitimate credit score repair companies. As with most industries nowadays, there are a number of shady companies offering credit restoration. Some people have been victimized by scams that were supposed to help their credit. Check online reviews about the company, the Better Business Bureau, and even the State Attorney General’s office to find out what their reputation is before signing anything or giving them any money or account numbers.
Your credit cards are not doing you any favors; avoid using them. Try to make purchases using cash only. If a credit card is used for a purchase, pay the entire balance when the bill arrives.
One of the most stressful aspects of handling bad credit is dealing with debt collection agencies. You can get a collection agency to cease and desist from harassing you but this does not discharge the debt. Letters such as these prevent calls from collections agencies, but the consumer must still pay the debts under dispute.
Be very careful about credit professionals who state that they could fix your credit quickly. Since there so many people struggling with their credit today, there are a lot of businesses that have popped up to take advantage of the situation. Prior to contacting any lawyer for help fixing your credit, investigate him or her thoroughly.
It is the worst when you have many debts that you are unable to pay. Therefore, you should aim to spread out all available money for spending to all of the creditors that you owe money to so that each one can get a portion of your money. Even making the monthly minimum payment will keep the creditors at bay, and stop them from hiring a collection agency.
If you need to rebuild your credit, you need to start establishing a history of responsible borrowing. Consider a card that requires payment in advance; this will improve your score without the risk of failure. Doing this shows lenders that you can be trusted with credit.
Your credit rating will also suffer from opening new lines of credit. Opening new lines of credit can hurt your score greatly, even if you get approved. As soon as you open a new credit line, your credit score drops.
Don’t put off until tomorrow what you can do today, especially now that you are armed with the necessary tools to put a plan into motion. The faster you act, the less likely your lowered credit score will permanently affect your life.