Bad credit hurts you in nearly all your financial dealings, especially those that involve extending credit to you. The longer your low credit score lasts, the more limited your financial choices will be. There is a way, however, to repair your credit and it will open more doors in your life. Follow the tips and information below to get started cleaning up your credit.
If your credit history has put you in the position where you are not able to obtain a regular credit card, you should try to get a secured credit card to begin rebuilding your credit. You will most likely be approved for this type of card, but you will have to add money to the card before you can use it so the bank will know that you can pay for all of your purchases. If you use a credit card well, your credit rating will begin rising.
You can receive a better interest rate if you have excellent credit. A lower interest rate means lower monthly payments, and less time paying off your debt. Make sure to use a company that gives you the best rates so your bill isn’t being built up by money you haven’t even spent.
Interest Rates
If you don’t want to pay too much at a time, you can avoid paying higher interest rates than you started with. It is bordering on illegal for credit card companies to charge you skyrocketed interest rates. Keep in mind that you did sign a contract agreeing that interest rates were acceptable. You need to be able to prove the interest rates are too high if you want to sue your lenders.
If you want to fix your credit avoid companies claiming they can remove all of your issues, even those properly reported. Bad marks on your report will not go away for seven years. If the information is an error, the credit report can be corrected.
Start paying on bills to help your credit. You can’t just pay whatever you want whenever you want. You need to pay your entire balance when it’s due. Once you start paying your past bills off, you will notice an immediate improvement in your credit.
You should consider talking to directly with your creditors when you are trying to improve your credit. This will assure them that you want to handle your debt and keep you from getting even further behind. Call them and see if you can change the payment terms. They may be willing to change the actual payment or move the due date.
Credit Counseling
Make sure you check out any credit counseling agency you consider using. There are some legit counselors, and there are some that have ulterior motives. Some will try to cheat you. A savvy consumer will always do his or her research on any credit counseling service to ensure that the agency is legitimate.
Find out how your debt settlement contract will make your credit score look. Some settlement agreements can actually be bad for your credit score, so be wary and do your homework. Debt settlers are more interested in their money than your credit rating.
Make sure to check all three of your credit reports, and pay extra attention to the negative reports when you are working on repairing bad credit. If you notice a mistake on your report, you could get some items crossed off. Even if the item itself is right, an error in the date or amount gives you the right to contest it.
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. Mail your dispute documents to the agency using certified mail and a return receipt so that you can prove the agency received them.
Credit Card
It will be easier to increase your credit rating if you only have one open credit card account. Transfer credit card balances to one card for loan consolidation. This way you can work on paying one credit card balance off, instead of a bunch of smaller ones.
If at all possible, avoid filing bankruptcy. When you file for bankruptcy it shows for 10 years, your credit report will suffer from this. Though the idea of ridding yourself of debt can sound appealing, the long term consequences just aren’t worth it. It could be near impossible to receive a credit card or loan if you have filed for bankruptcy.
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. You bear the responsibility for looking after your own best interests, and you are the only person who will know if your statement is accurate.
Your future will be a lot easier if you repair your negative credit. Many credit score repair strategies don’t cost a dime and can have immediate effects on your credit. These tips can make it possible for you to improve your credit effectively.
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