Whether you got your credit cards on your college campus, went shopping too many times or suffered from the bad economy, you’ve probably damaged your credit. Thankfully, there are methods in the below article that can help you mend this problem.
Getting a traditional home loan can be difficult, if not impossible, with imperfect credit. Federally guaranteed loans (FHA loans) may be an option. FHA loans are also great when a borrower doesn’t have the money to make a down payment or pay closing costs.
If you have credit cards with balances that are greater than fifty percent of the maximum, you should pay those down as quickly as possible. It’s best to keep all of your credit cards below the fifty percent mark! 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.
Installment Account
Getting an installment account can help you earn money and provide a boost to your credit. 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.
If you do not want to pay too much, contact your creditors and tell them you will not pay on a interest rate that is astronomical. Creditors are skirting aspects of the law when they hit you with high interest rates. Your initial agreement likely included a commitment to pay interest. If you choose to bring a lawsuit against your creditors, use the high interest rates against them.
You must pay your bills consistently if you want to repair your credit. Even more important than just paying your bills, is to pay off the entire balance, and pay them on time. Getting rid of past-due bills will have a fast and dramatic effect on your credit score.
Before you agree to any sort of repayment plan to settle your debts, consider how this will affect your credit score. There are ways that are less damaging than others, that is why it is important to research about it before starting an agreement with creditors. Most of the time they want their money and don’t care about your credit score.
Make sure to check all three of your credit reports, and pay extra attention to the negative reports when you are working on repairing bad credit. Even though the particular credit item may not accurate, finding an error in the amount, date, or something else can cause the entire item to be stricken from your report.
Credit Unions
Try joining a credit score if you’re still struggling to boost your credit rating by opening new lines of credit. Credit unions typically offer a wider variety of credit options at better interest rates than a traditional bank. Credit unions are usually non-profit, which means better deals for you.
Many times you and your creditor can work together to come up with a prepayment plan. If so, be sure you get a written agreement stating the terms. This way you have documentation of the agreement in case the creditor decides to change their mind or ownership of the company changes. If you manage to pay off your debt, make sure you receive proper documentation as proof to send to credit reporting agencies.
Only work with legitimate credit score repair companies. Unfortunately, the credit repair business does have a significant number of companies that are not reputable. It is sad to see how many people have been taken advantage of by credit score repair scams. One way to separate the wheat from the chaff is to check user reviews online.
When lenders are looking at your credit, an explanation that goes with the report generally will not even be looked at. In fact, it could actually make matters worse by bringing to their notice the negative aspects of your report.
Avoid using your credit cards at all. Pay for everything with cold, hard cash. When you do use a credit card, pay off the balance in full each month.
If anyone trying to collect a debt makes threats, make a note of their illegal behavior. You are protected by law, and you need to know that.
Repairing a poor credit score can seem like a daunting task, but improving your score is possible with guidance and knowledge. Use the information in this article to boost your credit score.