It doesn’t matter whether you fell victim to people giving out free credit cards, spent too much money or was hit very hard with the recession. Chances are that your credit has been damaged. Don’t despair, because there are ways to get things back on track.
Fha Loan
Getting home finance can be quite tough when your credit rating is not good. If your income is a factor you may qualify for a FHA loan, which has lower standards and makes the federal government your lender in a sense. If you do not have a down payment or money for closing, consider a FHA loan
Try opening an installment account. Make sure you can afford to make the payments and try to maintain a minimum monthly balance. A properly managed installment account will work wonders on your credit rating.
Any company or credit counselor that claims they can erase all negative reports from your credit history should be viewed with some skepticism. Negative entries that are otherwise accurate will stay on your credit report for a minimum of seven years. Be aware, however, that incorrect information can indeed be erased from your record.
Before using a credit counselor, it’s important to research them completely. While many counselors are reputable and exist to offer real help, some do have ulterior motives. Some companies you may find are outright scams. You should research any counseling service you are considering prior to initiating communications with them.
Do not do anything that will make you end up in jail. Sites may act like you can create new credit lines and tell you how to do it. It’s illegal to do this and you can get caught easily. The end result of getting caught during the crime could be expensive legal fees and a possibility of time behind bars.
Credit Unions
Credit unions are an option for those who have run out of options. Credit unions are normally located in communities and offer lower interest rates than national banks.
Close all your credit cards except for one as a means of repairing your credit. Call your credit card company and try to work out a repayment plan, or transfer the balances of multiple cards to one lower interest card. Doing so will allow you to pay off one individual debt rather than a multitude of lesser balances.
If you wheel and deal and get a new payment plan, be certain to have it on paper. This will protect you should the company change its policies. After you have paid the debt off completely, keep your receipt in case there are any discrepancies on your credit report.
To fix damaged credit, pay off your credit card balances as fast as you can. Start by paying the cards or accounts with the highest interest rates. Creditors will see this action as a sign that you are responsible and educated.
Paying your credit cards on time keeps you in good standing on your credit report. Anytime you don’t make a payment on time it can damage your credit and it can be hard to get a loan anywhere.
You should keep a low balance on your credit cards to improve your credit rating. Reducing the amount of debt you’re carrying is one of the best ways to improve your credit score. When balances are and increments of twenty percent of your total available balance on that account, the FICO system will take note.
Restoring your credit rating looks at first like an uphill battle, but with sound effort and the right advice, that battle can be won. The information given in this article is sure to lead you to a higher level of financial security.