A bad credit score can have many negative effects on your life, such as not being able to take out a loan, lease a car or get a new credit card. Credit scores can drop due to neglecting bills or paying fees too late. The advice in this article can help you get on track with repairing your credit score.
Getting a traditional home loan can be difficult, if not impossible, with imperfect credit. You should consider getting a FHA loan they are backed by the 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.
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. This card is very easy to get, because you put money into an account ahead of time and then spend from that, so the bank doesn’t have to worry about not getting their money. Responsible use of a credit card can help rebuild your credit.
Interest Rates
In order to make sure that you do not overpay, know that you can dispute your really high interest rates. Some companies that charge high interest rates are running the risk of having those rates challenged by consumers. You did sign a contract and agree to pay interest. If you go ahead and sue your creditors, ask that they consider the high rate of interest.
Any company or credit counselor that claims they can erase all negative reports from your credit history should be viewed with some skepticism. These things are, generally, on your record for seven years. Items that you can get taken off your record are those that have been reported incorrectly or unfairly.
As you work toward repairing your credit score, you should be willing to cooperate and work with your creditors. When you work with company you are not working against anyone, including yourself. This will help prevent furthering yourself into debt. One way to tackle this problem is to call them and ask if you can have the due date or monthly charge amount changed.
Credit Unions
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. These credit unions can probably give you better credit options in the long run.
If you find any errors on your credit report, you should dispute them. Contact the credit agency in writing, with documentation to support the errors that you are disputing. Mail your dispute packet with receipt confirmation so you will have proof the agency has received it.
Do not use credit cards to pay for things that you simply cannot afford. You need to change your thinking to consider your future goals, not just buy all of the things you want right now. In many cases, people are using credit cards to buy things they want, rather than focusing on things that they need. It is important to look closely at your finances and see what you can actually afford and what you can not.
One excellent way to get your credit score back up is to close all your credit cards except for one. You should arrange to make payments or make a balance transfer to your open account. Instead of paying several smaller credit card bills, you can work to pay off one credit card.
Carefully check all charges on your monthly credit card statement for errors. If there are late fees, you have to make sure that you take care of them immediately with the company so that they don’t send that information to the credit bureaus.
If you are able to negotiate a repayment plan with your creditor, be sure to get it in writing. The documentation you gain from the creditor is important in case the company changes ownership or the creditor is no longer interested in the deal. Once you finish making all your payments, be sure to send that information to the credit agencies in writing.
Your credit score affects the interest rate you will pay on any type of loan. If you are buried under a mountain of debt and have poor credit as a result, you can crawl out of that hole using the following tips.
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