Developing a low credit score is easy to do, but difficult to remedy, leading to financial barriers that are hard to surmount. It can make you feel like you are in debtors’ prison with no hope of escape. Yet, some simple steps can fix your credit and help you to keep your credit in good standing.
The first step in repairing your credit is figuring out a plan that works for you, and sticking with it. Real changes come from commitment to healthy spending habits. Only purchase something if you cannot live without it. See if each purchase is necessary and affordable and only purchase something if the answers are “yes”.
Credit Card
When your credit is so bad that you can’t get a ‘regular’ credit card, a secured one will help you to repair your credit. Secured credit card applications have a high rate of approval because you must fund a security deposit against your credit limit. Even though this card will be secured by your own money, you will make payments and manage it as if it were unsecured. This will improve your credit as you show yourself able to make the payments on time.
Any of your credit cards with balances that are above 50% of your overall limit need to be paid off as soon as possible, until the balance is less than 50%. If you have a balance that is more than 50 percent, your credit score will drop. If you can, pay the balances on your cards; if not, do your best to pay as much as possible each month.
To earn a sufficient wage and boost your credit, try opening an installment account. You should make sure it is an installment account that you will be able to pay into every month. A properly managed installment account will work wonders on your credit rating.
To avoid paying too much, you can refuse to pay off huge interest rates. In most cases, creditors are somewhat limited in the amount of interest they can charge. You did sign a contract and agree to pay interest. Be very wary of suing your creditors, especially if all of your issues were covered in the contract.
Credit Report
Do not fall for the false claims many have about their ability to fix your credit. The claim that they can remove accurate debts from your credit report is false. All information remains on your credit report for a period of seven years or more. You should know that mistakes and anything incorrect can be removed from your credit report.
Paying your bills is something you need to do to repair your credit. You need to pay your bills off on time; this is very important. Once you start paying your past bills off, you will notice an immediate improvement in your credit.
Consumers should carefully research credit counseling agencies before choosing one with which to work. Many counselors are on the up-and-up and are truly helpful. Others just want to take money from you. Some are not legitimate. Wise consumers always verify that credit counselors are legitimate before dealing with them.
If you’re trying to fix your credit, be sure to check all your negative reports carefully. Even though the particular credit item may not accurate, finding an error in the amount, date, or something else can cause the entire item to be stricken from your report.
Take the necessary steps to fix any mistakes that you see on your credit reports by filing an official dispute. Write a dispute letter to any agencies with recorded errors, and include supporting documents. Use a return receipt when you mail your package so that you can prove that the agency received it.
Easy tips, like the ones in this article, will help you repair your credit and keep it healthy in the future. Educating yourself about credit and how it works is an important investment that will pay off in the future.