You might feel like you are being taken advantage of it you have bad credit. Your bad credit might remind you of your past, and the poor decisions or circumstances that led you to where you are today. However, your luck can change when you realize that there are simple things that you can do immediately to raise your credit.
Poor Credit
If you have a poor credit rating, it can be extremely difficult to obtain a mortgage loan for a home. If you do have poor credit, try to get a FHA loan because there is a guarantee that it will be given to you. FHA loans are also great when a borrower doesn’t have the money to make a down payment or pay closing costs.
Pay down the balance on any credit card that is 50% or more of the credit limit. Carrying a balance of more than half your credit limit negatively impacts your credit score. Either pay this balance down or spread it out over multiple cards.
Having a lower credit score can lower your interest rate. This should make your monthly payments easier and allow you to pay off your debt much quicker. Obtaining lower interest rates will make it easier for you to manage your credit, which in turn will improve your credit rating.
If you don’t want to pay too much at a time, you can avoid paying higher interest rates than you started with. If you are being charged a distressingly high interest rate, you may be able to talk to your creditor. However, the contract you signed ensured that you agreed to pay off your interest. If you decide to sue your creditors, you should be able to have the interest rates recognized as too high.
As you work toward repairing your credit score, you should be willing to cooperate and work with your creditors. This will help you stabilize your situation and start working towards a better financial situation. This can be accomplished by negotiating with them for a change in due date or monthly charges.
Put the spending brakes on yourself by lowering your credit limit on all of your cards. Not only will this prevent you from owing more, but it will be reflected in your credit score because it shows that you are responsible with your credit.
Credit Score
Don’t sign a debt settlement contract until you know what impact it is going to have on your credit score. Some methods are less damaging than others; research them all before making an agreement with your creditor. The creditor does not care what happens to your credit score, as long as they get their money.
Joining a credit union can give you opportunities to increase your credit score. Credit unions sometimes have better rates and more options for your credit rather than a large bank. You can base this on how well the economy is in your area instead of the national situation.
Check your credit card carefully each month to ensure that there’s no incorrect information. If you spot any late fees, immediately contact your credit card company. This can save you from having late payments reported to the credit reporting agencies.
Carefully read the small print on your statements. You will need to read over every charge on your account to check that it is accurate. You must be accountable for each item on your statement.
Lower the debt on revolving credit accounts, like store and credit cards, first. Maintaining smaller balances can improve your credit rating. When balances reach anywhere from 20-100% of your available credit balances (in 20% intervals), the FICO system will make a note.
When attempting to fix your credit score, exercise caution when it comes to attorneys and legal teams that advertise instant repair of credit. Since many people have credit issues every day, there are now scam lawyers that promise to repair them. They charge large fees, and most of the time the services they provide are illegal and have no worth. Check the reviews and reputation of any lawyer or credit restoration firm thoroughly before you contact them and certainly before you give them any money.
Credit Score
Opening too many lines of credit negatively affects your credit score. When offered large discounts or incentives for opening a new credit card, politely reject the offer. If you open all these new accounts, you could see a drop in your credit score.
Bad credit can really get you down in the dumps. Take charge of your credit, and find out what you can do to increase your score.
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