There are a lot of ways to damage your credit score, from falling for a credit card scam to just being unlucky with the recent economy. The following tips will help you take steps to begin to repair your credit.
When attempting to make your credit right once more, it is imperative that you present a solution to all those that you owe money to, and don’t deviate from anything you commit to once it is in place. You need to make a commitment to changing your spending habits. Sticking to necessities for a while is crucial. 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.
If you have a poor credit history and can’t qualify for a credit card, get a secured card. Most likely, you will not have a problem obtaining this type of card, but you must add funds to the account before you make any purchases to assure the bank that you will pay. Limited spending and regular payments can turn a new credit account into a valuable credit repair tool.
Any of your credit cards with balances that are above 50% of your overall limit need to be paid off as soon as possible, until the balance is less than 50%. You should keep your balances under fifty percent; anything over this and you can lower your credit rating, so spread out the money you own and pay down your credit cards.
Installment Account
An installment account is a great way to increase your credit score. You need to review the terms of an installment account carefully, because you’ll be required to maintain a certain monthly minimum. Your FICO score will rise over time, if you responsibly manage this type of account.
Try to negotiate with your creditors about the amount of interest you’ll pay on an old debt. You may be able to challenge an interest rate that is extremely high. You did sign a contract saying that you would pay off the debt. The only way you are legally able to sue the creditors is if you are able to prove that your interest rates are much too high.
To start fixing your credit, you will have to pay your bills. Pay these bills on time, and make sure you pay the full amounts owed. As soon as you have cleared those old debts, you will see an immediate improvement in your credit score.
Credit File
Be wary of credit score improvement scams that can get you in legal trouble. The Internet is rife with many scams that will go into detail about creating yourself a brand new credit file and making the old one magically disappear. Creating a new credit file is very illegal and you can be easily caught. You could go to jail if you have a lot of legal issues.
When looking over your credit report, look closely at the negative report that are listed. Even if the item itself is correct, any small mistake in the item, such as an inaccurate date or amount, may let you have the whole thing taken off your credit report.
It is important to carefully review your monthly credit card statement. If you spot any late fees, immediately contact your credit card company. This can save you from having late payments reported to the credit reporting agencies.
Be certain to get any credit repayment plan in writing. This will provide proof of your agreement in case any problems ever arise. Once you finish making all your payments, be sure to send that information to the credit agencies in writing.
When you receive your credit card statement, go over it carefully. It’s up to you to ensure that the charges on your bill are correct and that you haven’t been double charged, overcharged or charged for something you didn’t buy. You are the only person that is responsible for making sure the statements are error free.
Try to use credit cards only for purchases you can afford to pay off. Try to use cash instead for all of your purchases and bills. If the purchase you’re buying is more than you can currently afford you can use a credit card, but pay it back as soon as possible.
Collection Agencies
One of the most nerve-racking aspects of being in debt, and having bad credit, is dealing with collection agencies. A consumer had the option of making use of cease and desist statements to persuade collection agencies, but remember that C&D statements only prevent them from harassing you. Sending the letter does not mean you no longer have to pay the bill, it only stops the collection agency from calling.
If you want to fix your credit it can seem like a lot to handle, if you work hard you can do it the right way. Use the information gleaned from this article to fix your credit and improve your life.
