It can be stressful to deal with having a bad credit score. It can be even more stressful when you have to deal with poor past decisions. Repairing your credit will be hard, but it is totally possible. Read on to find out how.
Pay down the balance on any credit card that is 50% or more of the credit limit. When balances are over 50%, your credit rating goes down significantly, so try to either spread out your debt or, ideally, pay off your credit cards.
By maintaining a good credit score, you can decrease your interest rate. Doing this can reduce monthly payments, which will assist you in paying off any outstanding debts faster. Try to get the best offer and credit rates so you can increase your credit score.
If you make a decent income, consider an installment account when you want to give your credit score a boost. With an installment account there is a monthly minimum you need to keep, so only open an affordable account. You might see a big improvement in your credit score, if you can handle an installment account responsibly.
When trying to rehabilitate your credit, it is important to work with each credit card company you are indebted to. This prevents you from sinking further into debt or further damaging your credit score. You can accomplish this by simply calling and asking them to change payment terms, like your interest rate or your billing date.
Credit unions are an option for those who have run out of options when trying to find a line of credit to boost their score. Credit unions have opportunities that are better than other places and are usually local.
Too many credit cards is a common cause of financial strain, so close all of your accounts aside from one. You should plan on how you will pay the remaining open balances, or how to consolidate them into one account. Doing so will allow you to pay off one individual debt rather than a multitude of lesser balances.
Take the time to ensure each month’s credit card bill is correct. If this is the case, you need to call the company right away to avoid them from reporting it to credit reporting agencies.
If you and a creditor agree on a payment plan, make sure the agreement is committed to paper. If the creditor tries to change the agreement or if it the company is sold to someone else, you will have documentation to support your case. As soon as you get it paid off, have that in writing so you are able to inform the credit reporting agencies.
Comb through all of the bills that you get! Make sure that all of your fees and charges are correct and that there are not any items that were not authorized by you. It’s up to you to make sure that every item on your bill is correct and dispute those that are not.
Don’t use credit cards a lot. Try to make purchases using cash only. If the purchase you’re buying is more than you can currently afford you can use a credit card, but pay it back as soon as possible.
There are many law offices that promise quick credit fixes; avoid these. Because so many people are experiencing credit problems due to the economy, shady lawyers that advertise useless, possibly illegal credit score improvement services have appeared. Investigate a lawyer before hiring them to help you in repairing your credit.
Building your credit back up is the number one way to fix a bad credit score. Prepaid credit cards can help you demonstrate responsible use of credit without having to worry about missing payments or late fees. This will show potential lenders that you are responsible and credit worthy.
Create a plan to settle all of your unpaid and past-due accounts. These will remain on the credit report, but will be reported as paid. This is better than having past due debt.
Following the given advice will help tremendously in your credit building efforts. Most importantly, you want to have a consistent plan and stick to your commitments. It is possible to repair your credit, so get to work!