Does your credit report smell like rotten eggs, dead fish, and cow manure all mixed together? The following tips are a helpful credit restoration guide that will change your negative situation into a positive one.
Look at the credit card accounts you have with a balance over 50% of the credit limit. Pay those off until they fall under this number. When your debt is over 50%, credit ratings usually go down. With that said, try to spread out the debt that you have or try paying it off.
Interest Rate
You can reduce your interest rate by maintaining a high credit score. A lower interest rate means lower monthly payments, and less time paying off your debt. Try to get the best offer and credit rates so you can increase your credit score.
A respectable credit score makes it much easier for you to purchase a home with a mortgage. If you wish to have an even higher credit score, make sure that you pay your house mortgage off on time. Owning a home provides financial stability which is backed by your asset, the home, and as such, results in great credit. This will also be useful in the event that you end up needing to borrow funds.
If credit score improvement is something you are investigating and a company has told you they can strike true, but negative, information off of your credit report, they are lying. These things are, generally, on your record for seven years. You can, however, succeed at having incorrect information erased from your credit reports.
Due Date
You can work with the credit card companies to start repairing your credit. You should contact the company and request a lower interest rate or a due date change if necessary. Politely ask if it is possible to have your minimum monthly payment adjusted or due date changed.
Learn what affect a debt settlement plan will have on your credit rating before you sign up. Some agreements cause less damage to your credit score than others, and each should be considered prior to making an arrangement with a creditor. The creditor is only interested in receiving the money due, and is not concerned with your credit score.
Read your negative reports carefully when attempting to rebuild your credit. The item may be essentially correct, but there may be an error someplace. If the date or amount, or some other thing is incorrect it may be possible to get the entire item removed.
Dispute every error you identify on your credit report. Create a dispute letter for agencies that have the error, and submit additional supporting documents along with it. 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 at all possible, avoid filing bankruptcy. This will show up on your credit for around 10 years. Although it seems like the wise thing to do at the time, it will bring you negative consequences in the long run. It may be hard to get a credit card or a loan if you declare bankruptcy.
Paying your credit cards on time keeps you in good standing on your credit report. Every late credit card payment can damage your credit score.
Credit Card
To protect yourself from credit card fraud, it is essential that you carefully review each monthly statement from your credit card companies. Look for any changes that have happened, and make sure they are correct. You do not want to end up paying for a purchase that you did not make. You bear the responsibility for looking after your own best interests, and you are the only person who will know if your statement is accurate.
You should locate a good credit restoration company to help you. As with most industries nowadays, there are a number of shady companies offering credit score improvement. A fair number of people have been scammed by these unethical credit repair companies. If you do some online research, you can find out what people really think about the various credit improvement agencies. This will help tremendously in choosing a safe and effective company.
Try not to use your cards at all. Pay with cash whenever possible. Pay off any credit card purchases immediately.
Collection Agencies
The worst part of a credit crisis may be the 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. Even though these letters will stop the phone calls from collection agencies, the individual is still responsible for paying the disputed debt.
Don’t fall prey to law offices that promise you instant credit fixes. 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. Do your homework and check out any attorney before you hire one to help with credit repair.
It goes without saying that if your credit is poor and needs repairing, you need to start from the bottom and build. Prepaid credit cards can be a good way to raise your FICO score, away from the dangers of late fees or charges for exceeding your credit limit. By doing this you will be proving to potential lenders you are credit worthy and capable of paying money when you are required.
Repayment Plan
If you are struggling with payments as planned, talk to the creditors themselves. Often times they will work out a deal. You may be able to defer some lines of credit, like federal student loans. You can refinance other loans, like vehicle loans. In any case, you want to protect your credit and creditors may be willing to work out a repayment plan with you. This may also alleviate some financial stress and allow you to work on paying off any debt accounts where you are not allowed to make a repayment plan.
If you use the sound advice in the article above, your bad credit will no longer give you bad dreams. You can stitch up your credit and make it just like new. By following these tips, you will soon have an ideal credit rating!
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