Bad credit can make you feel like a victim. If you’ve recently gone through some hard times, a bad credit score is just an ugly reminder of that experience. There are a variety of things that you can do to help get your credit score under control. Here are some great tips!
If you have a poor credit rating, it can be extremely difficult to obtain a mortgage loan for a home. 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. FHA loans are also great when a borrower doesn’t have the money to make a down payment or pay closing costs.
It’s easy to lower your interest rate by ensuring your credit score is high. A lower interest rate means lower monthly payments, and less time paying off your debt. Paying your outstanding balances on time is the best way to keep your credit in check, and to obtain lower interest rates.
Installment Account
If you make a decent income, consider an installment account when you want to give your credit score a boost. You have to keep a monthly minimum on an installment account, so make sure you open an account that you can afford. You can improve your credit rating quicker using this type of account.
When starting to repair your credit, pay your bill on time from now on. You can’t just pay whatever you want whenever you want. You need to pay your entire balance when it’s due. Your credit rating can improve almost immediately when you pay off past due bills.
Though it is an unsettling prospect, consider asking your credit card provider to reduce the amount of credit extended to you. This will help you accomplish three things: 1. You will avoid being overextended. 2. Credit card companies will begin to view you as responsible. 3. It will be easier for you to get credit as time passes.
Credit Agency
If you see errors on your credit reports, dispute them with the credit agency. Contact the credit agency in writing, with documentation to support the errors that you are disputing. 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.
Live within your means. This will require a change in your thinking. Easy access to credit makes it simple for many people to buy expensive items that they do not have the money for, and a lot of individuals are dealing with the consequences of those purchases. Take a hard honest look at your budget, and figure out what you can honestly afford to spend.
Too many credit cards is a common cause of financial strain, so close all of your accounts aside from one. Transferring multiple balances to one single card is a way to gain control of your finances. It will be easier for you to make payments on a single credit card account, as opposed to several.
If at all possible, avoid filing bankruptcy. It can adversely affect your credit for up to 10 years. Though the idea of ridding yourself of debt can sound appealing, the long term consequences just aren’t worth it. You may not qualify for auto financing or a credit card after filing for bankruptcy protection.
Doing this will ensure that you keep a solid credit score. Whenever you fail to make your payments on time, your credit report is affected negatively. This can make it very difficult for you to take out a loan in the future.
Try and pay down any revolving account balances in order to boost your credit score. Maintaining smaller balances can improve your credit rating. Increments of twenty of available credit are noted by fico.
Statements like these will only be ignored, so it’s not worth the trouble. It can even draw more attention to the bad spots, so don’t do it.
If you are having a lot of trouble with your credit, consider locking up your credit cards for a while. Using cash will ensure that you stick to your budget and don’t overspend. If you are forced to use credit, pay it back immediately.
One of the most nerve-racking aspects of being in debt, and having bad credit, is dealing with collection agencies. You have the option of sending a cease and desist letter to agencies to stop them from calling, but that doesn’t mean that your debt vanishes. Letters such as these prevent calls from collections agencies, but the consumer must still pay the debts under dispute.
Having a lot of debts that you cannot pay is part of having bad credit sometimes. Be sure to give a portion of your spendable income to each of your creditors. Minimum payments will keep your debt accounts in good standing, and will keep them from ending up in collections.
Poor credit leads to pessimistic attitudes. If you follow the tips offered in this article, you can start to feel differently about your credit life.