You need not suffer the effects of bad credit, no matter how you wound up with credit problems. Whether you have been personally damaged by economic conditions, victimized by dishonest lenders or even were simply too carefree in your spending, you deserve better credit. Fortunately, there are actions you can partake to reverse this.
Having poor credit makes financing a home a nightmare. If this is the case, you can apply for a loan through the Federal Housing Administration (FHA). The credit requirements for these loans are more lenient than those of conventional lenders, and the federal government also guarantees the loans. You may even qualify for an FHA loan if you don’t have enough money for a down payment or the closing costs.
The first step to repairing your ailing credit is to create a manageable, feasible financial plan. You need to change your past habits and build new, better approaches to credit. Don’t buy the things that aren’t needs. Before you open your wallet ask the questions “do I need this?” and “can I afford this?” If the answer is no to either, put it back on the shelf.
Regular Card
If your credit is such that you cannot get a new card to help repair it, apply for a secured one. These are extremely easy to qualify for. A secured credit card looks just like a regular card, and works like a regular card, but you have to have the necessary money in an account to guarantee payment. If you show a good history of payments with this card, it will help improve your credit standing.
If you have credit cards with a utilization level over 50%, then pay them down until they are below 50% utilization. Once your balance reaches 50%, your rating starts to really dip. At that point, it is ideal to pay off your cards altogether, but if not, try to spread out the debt.
A good credit report means you are more likely to get financing for a home. If you pay your mortgage as agreed, your credit score will rocket into the stratosphere. As a homeowner, you will have a major asset that can have positive effects on your credit profile. These benefits will pay off if you need to secure a loan.
Do not fall for the false claims many have about their ability to fix your credit. The claim that they can remove accurate debts from your credit report is false. Negative credit information remains on your record for up to seven years. It is possible to have erroneous information removed from your report, however.
You must pay your bills consistently if you want to repair your credit. However, it’s not enough to just pay your bills; you need to make your payments on time and in full. You will immediately see changes in your credit score when you begin to pay off your debts, especially those that are active.
Credit Card Company
Some sound advice to follow, is to be sure to take the time to contact your credit card company and work with them. You should contact the company and request a lower interest rate or a due date change if necessary. Contact your credit card company and request to change your scheduled due date or interest rate.
Don’t do anything illegal. You should steer clear of internet programs that show you how to clear your credit. Needless to say, this is against the law and you are likely to get caught. You could go to jail if you have a lot of legal issues.
Requesting that your credit card limits be lowered can benefit you. 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.
Check over your credit bill each month to make sure there are no errors. Should there be any mistakes, contact the company and talk to them to avoid being reported to the credit companies.
Interest Rate
Pay off any balances as soon as you can. Sort your credit cards by balance and interest rate with the highest first. Then determine which credit card is the highest either in balance or interest rate and start to pay it off first. This action will show creditors that you are being responsible with credit.
Carefully read the small print on your statements. You should make sure that the charges that you get are right, and that you’re not paying for items you did not buy. It is solely your responsibility to be sure that everything is correct.
You may want to argue against the reports, but potential lenders will not take your statements into consideration. In fact, it could actually make matters worse by bringing to their notice the negative aspects of your report.
If you are having a lot of trouble with your credit, consider locking up your credit cards for a while. Do all of your spending with cash or debit cards. If you do use a credit card, pay the full balance each month.
If you are determined and ready to learn, you can fix your credit in no time. Use what you’ve learned in this article to start fixing your credit and improve your credit score.
