Whether you fell prey to the guys handing out credit cards like candy on campus, got carried away on one too many shopping sprees or got hit hard by the recent economic downturn, you probably did some damage to your credit. Thankfully, there are methods in the below article that can help you mend this problem.
Financing a new home can be a challenge, especially if you have a history of bad credit. FHA loans might be a good option to consider in these circumstances, as they are backed by our federal government. It might be possible to get an FHA loan even if you don’t have the money for a down payment or the closing costs involved.
Credit Card
If you have a poor credit history and can’t qualify for a credit card, get a secured card. These are extremely easy to qualify for. A secured credit card looks just like a regular card, and works like a regular card, but you have to have the necessary money in an account to guarantee payment. A responsibly used new credit card will begin healing your credit score.
If you have credit cards with a utilization level over 50%, then pay them down until they are below 50% utilization. Any time you exceed 50% of your credit limit, your credit rating is affected. Pay off credit cards as fast as you can, or spread the debt out further.
Interest Rates
You can keep your interest rates lower by working to keep your credit score as high as possible. Lower interest rates make paying bills easier, and prevents you from incurring debt. Quickly paying off your debts is a good way to improve your credit score. This will give you access to more competitive rates in the future.
Before you hire a credit counselor, make sure that you have done your research. Many companies are legitimate and hold your best interests as a priority, but some are outright scams. There are a lot of people out there that are trying to take advantage of those who are down on their luck. A savvy consumer will always do his or her research on any credit counseling service to ensure that the agency is legitimate.
Though it is an unsettling prospect, consider asking your credit card provider to reduce the amount of credit extended to you. By doing this it will stabilize you in your financial boundaries instead of letting you extend beyond what you really should.
Find and challenge errors on your credit report using the dispute process offered by each credit reporting agency. Write a dispute letter to any agencies with recorded errors, and include supporting documents. Always send your dispute letters certified mail, so that you can get return confirmation. This will give you proof that the agency received your dispute paperwork.
It will be easier to increase your credit rating if you only have one open credit card account. Making one monthly payment will be easier than paying off different bills. This way you can work on paying one credit card balance off, instead of a bunch of smaller ones.
Always get a plan in writing if you are going to do a payment plan that deals with creditors. 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. If you have finished paying it off, you should request a confirmation so you can send it to the credit reporting agencies.
Timely payments will keep your credit status in good standing. Anytime you don’t make a payment on time it can damage your credit and it can be hard to get a loan anywhere.
Credit Score
When working with a credit score repair agency, it is imperative to find one that is legitimate. The credit restoration business has a lot of unfair and shady companies. Indeed, some people have fallen prey to credit score improvement scams. By reading user reviews online, you will be able to separate the good from the bad.
Repairing the credit you damaged might seem overwhelming, but you can fix your credit with effort and the right kind of information. With the advice you were given in the above article, you can get to work on improving your credit score today.
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