Poor credit is a terrible thing for you to deal with as you journey through life. A bad credit score will make it hard for you to get a loan or apply for housing, among other things. There are a few steps you can take to start repairing your credit now.
Pay down the balance on any credit card that is 50% or more of the credit limit. If you have a balance that is more than 50 percent, your credit score will drop. If you can, pay the balances on your cards; if not, do your best to pay as much as possible each month.
It’s easy to lower your interest rate by ensuring your credit score is high. Lower interest rates make it much easier and quicker to pay off balances. Paying your outstanding balances on time is the best way to keep your credit in check, and to obtain lower interest rates.
If you can afford to pay another monthly bill, an installment account paid on time will increase your credit rating. Make sure you can afford to make the payments and try to maintain a minimum monthly balance. If these accounts are properly managed, they can provide a quick boost to your credit score.
Interest Rates
If your creditors try to jack up your interest rates, do not pay them. Creditors who charge exorbitant interest may be just a law suit away from having to wipe the slate clean. Remember that you agreed to pay that interest when you signed the contract. If you plan on suing your creditors, you may be capable of having the interest rates viewed as being too high.
Start paying your bills in order to repair your credit. More precisely, you must begin paying your bills fully and on time. You will notice an improvement in your credit score pretty quickly after paying off some past debts.
Credit Counselor
Always do research before contracting a credit counselor. While some counselors are legitimate, offering genuinely helpful services, others have ulterior motives. Some are not legitimate. Smart consumers make sure that a credit counselor is legit before starting to exchange any money or sensitive information.
Prior to agreeing to a debt settlement agreement, find out how that process is going to impact your credit score. There are methods that are going to be less damaging than another, and all should be researched before you enter an agreement with a creditor. They do not care about the effects of what they do to your credit score and are just in it for the money.
If you are trying to improve your credit score but are having difficulty gaining access to new credit in order to do so, join a credit union. These credit unions can probably give you better credit options in the long run.
Taking time to examine your monthly credit card bill is critical to ensure that there are no errors. If such fees are present, you need to get in touch with the credit card company right away to avoid adverse action.
It is important to get any payment plan that you agreed to with a creditor in writing. Having the plan in writing will protect you if the creditor reneges on the plan or if your debt is transferred to another creditor. Once you finish making all your payments, be sure to send that information to the credit agencies in writing.
Avoid bankruptcy at all costs. Bankruptcy does not drop from your credit report until ten years have passed, so you will deal with the fallout for a significant period of time. While ridding yourself of most debt may seem ideal, it is not without consequences. Filing for bankruptcy will make it very difficult for you to qualify for credit in the future.
Go through all the statements you receive. Take a second look to make sure that you are being charged only for what you actually purchased. You are the person responsible for checking that there are no errors.
Credit Score
Any time that you take out a line of credit it is going to negatively impact your credit score. When you are offered a credit card when checking out at the store, fight the urge to get one to receive the discounts that are offered to you. If you continue to increase your debt, your credit score will continue to drop.
Devise a repayment plan that will satisfy your collection account and any other accounts that are in arrears. These will remain on the credit report, but will be reported as paid. This is better than having past due debt.
Record any debt collector who makes threats towards you because this is illegal. Consumers have rights, and you need to be informed of what they are.
If you apply these tips, you should be able to improve your credit and maintain a good score. Having a solid credit score can impact many important purchases that you make, so taking time from your busy schedule to read up on this subject is always a good idea.
