Is your credit terrible? By following these tips, you can achieve a credit report that you do not have to be ashamed of.
Secured Card
If you have credit that is not high enough for you to obtain a new credit line, sign up for a secured card. With a secured card, you have to fund your account before you use the card so that the bank will be assured that you will pay off your debts. Responsible use of a credit card can help rebuild your credit.
A good credit report means you are more likely to get financing for a home. Fulfilling your mortgage obligation in a timely fashion does a great deal of good for your credit rating. Having a major asset like a house also looks good to potential creditors. This will make taking out future loans much easier.
Credit Score
If you make a decent income, consider an installment account when you want to give your credit score a boost. You are required to meet a monthly minimum, so be sure that you can make the payments. Your credit score will significantly get better if you get an account.
If you are living beyond your financial ability, stop now. You need to change your way of thinking in this regard. If you’re buying flashy items to boost your reputation, consider that a smart person who isn’t being chased by collectors will have an even better reputation! Be sure to assess your finances and find out the things that you can afford.
If a creditor agrees to give you a payment plan, get that payment plan in writing. If the creditor tries to change the agreement or if it the company is sold to someone else, you will have documentation to support your case. If you have finished paying it off, you should request a confirmation so you can send it to the credit reporting agencies.
Filing Bankruptcy
If at all possible, avoid filing bankruptcy. This negative mark will stay on your report for 10 years. It sounds very appealing to clear out your debt but in the long run you’re just hurting yourself. Filing bankruptcy makes it difficult if not impossible to get anything involving credit, like credit cards and loans, in the future.
Pay your bill early or on time each month to ensure that your credit score stays good. Each time you make your payment late it will go against you.
You should keep a low balance on your credit cards to improve your credit rating. Maintaining smaller balances can improve your credit rating. The FICO system notes when balances are at 100, 80, 60, 40 and 20 percent of your total credit available.
If you have suffered job losses due to the economy, you may not have the cash to pay all the debts you owe. Make the minimum payment on each of your debts and use any leftover money to concentrate on paying off the highest interest debt. Even if you are only making minimum payments, sending along at least a little money will mollify your creditors and prevent them from contacting collection agencies.
Your credit score is significantly affected every time a fresh line of credit is opened by you. Resist the urge to sign up for credit cards even when they promise you instant savings at the checkout. Credit scores typically drop when new credit is opened.
Come up with a way to pay off any existing unpaid debts. These accounts will still appear on the credit report, but will be showed as paid. This shows future creditors that you made good on your debt.
It is not legal for collectors to threaten you, so always report them if they get too aggressive. It is important that you are knowledgeable of the laws designed to protect the consumer.
Credit Counseling
If you are having trouble creating or maintaining a budget, discuss your situation with a credit counseling service. These counselors can help you build a repayment plan that works for your financial situation. Credit counseling can give you the tools you need in order to keep track of your finances and stay out of debt in the future.
Now you know your credit report does not have to be a nightmare for you. Your credit situation can be turned around and you will finally have peace of mind about it. By learning from these tips, you can have the credit report of your dreams.
