Errors in your credit history report can significantly affect your credit rating which, in turn, can make it difficult for you to acquire new credit. The most economical way to fix your credit is to do it yourself. Read the rest of this article to discover the steps to fixing your credit.
If you have a poor credit history and can’t qualify for a credit card, get a secured card. These accounts are much easier to get as you will have to fund the new account ahead of time with a deposit to cover any purchases. By using a new card responsibly, your credit rating will start to increase.
Installment Account
Improve your credit score, as well as make some profit, through an installment account. An installment account requires a monthly payment, make sure you can afford it. Handling an installment account correctly will help you improve your credit score in a short period of time.
Try to negotiate with your creditors about the amount of interest you’ll pay on an old debt. The incredibly high interest rates can get challenged and reduced in some situations. However, you have entered into a legal agreement that requires you to pay accrued interest. If you decide to sue your creditors, you should be able to have the interest rates recognized as too high.
If you are looking into a credit counselor, be sure to find out information about them before you choose to use them. Many may have ulterior motives, so make sure you are not being duped. Some are simply fraudulent and are out to get your money. Knowledgeable purchasers will always make sure that the credit counselor in question is legitimate before hiring.
Do not try something that you do not know is legal or illegal. A common scam involves teaching you how to make a completely new, albeit fraudulent, credit file. Creating a new credit file is very illegal and you can be easily caught. They may seem like a small matter, but if you get caught, you could receive heavy fines and even jail time.
Credit Card Company
Give your credit card company a call and ask them to lower the limit on your credit card. Not only will this stop you from overspending, it will indicate responsible behavior to a credit card company, and may enable you to get future credit.
If getting a new line of credit is vital to your credit repair efforts, look into joining a credit union. Credit unions focus more on the local situation instead of the national one, and may provide more options or rates that are more favorable than those of a larger bank.
If you find inaccuracies on your credit report, make sure to dispute them. Draft a dispute letter that will go to each credit rating agency that shows an error, and prepare any supporting documents. Your letter should be sent with a request for return receipt, so you can have a record that it was received by the reporting agency.
If you and your creditor decided to set up a payment plan, you should first get the details of the plan in written form. This will give you important documentation in case of an ownership change or if the creditor tries to back out of the agreement. When you pay it off, send a written copy of proof of payment to all three credit reporting agencies.
One of your main tasks in credit restoration is paying off your cards as fast as you can. Start by paying the cards or accounts with the highest interest rates. This shows creditors you are responsible about your credit cards.
Credit Score
To earn a higher credit score, keep revolving account balances low. Having a lower balance will boost your credit score. The FICO system makes a note to your credit report every time your account balance reaches a new 20% increment of your total available credit.
As shown here, if you want your credit score to rise, there are quite a few pro-active steps you can take. The following tips will help you get your credit score back on track. Repairing your credit yourself is possible and is a good way to get your life back on track.