Have you been suffering from poor credit for years? Current economic conditions are affecting a lot of people’s credit. The following tips can help make that score better.
Credit Card
If you need a credit card to aid in fixing your credit but you cannot obtain one due to the state of your credit, applying for a secured credit card is an option. You will most likely be approved for this type of card, but you will have to add money to the card before you can use it so the bank will know that you can pay for all of your purchases. If you use a credit card responsibly, you will go a long way in repairing your credit.
Any credit cards that have balances over 50% of your limit should be paid off until they are less than 50% of your limit. 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.
You can get better interest rates on credit cards and loans when you have a good credit score. It will lower your monthly payments, so your debt will be taken care of at a much quicker rate. Quickly paying off your debts is a good way to improve your credit score. This will give you access to more competitive rates in the future.
If your credit is good, it’s easy to get a mortgage on a new home. Making mortgage payments in a timely manner helps raise your credit score even more. Owning a home shows financial stability, which is great for your credit. If you have to take out a loan, this will help you.
Due Date
Work closely with all of your creditors if you are aiming towards repairing your credit. You should contact the company and request a lower interest rate or a due date change if necessary. You can do this by speaking with them and asking to change the monthly charges or due date.
Make sure you research a credit counselor before you visit them. Some counselors truly want to help you, while others are untrustworthy and have other motives. Some are simply fraudulent and are out to get your money. Be a wise consumer by checking whether or not the credit counselor you are going to deal with is legitimate.
Do not involve yourself in illegal activities. The web is full of scams that show you how you can craft a deceptive credit file. Of course, this highly illegal, and it will cause you even more problems, because it will not go unnoticed. Taking these short cuts will end up costing you money and could lead to a stay in jail.
Debt Settlement
Find out how the process will affect your credit rating before you agree to any debt settlement agreements. Research all of your options, make an informed decision about the method you chose, and only then should you agree to the settlement. Some debt settlement companies are only after profits and do not communicate the likely consequences of their methods.
Doing this will ensure a good credit score. Late payments to credit cards are reported to the major credit agencies and can hurt your chances for securing a new loan.
Try lowering the balance of any revolving accounts you have. Your credit score can be raised if you lower your balances. The FICO system notes when balances are at 100, 80, 60, 40 and 20 percent of your total credit available.
lenders will not read these statements when looking at your credit report. The less you can do to attract attention to negative reports, the better.
Put your credit cards on lock down and don’t use them at all, if possible. Try to use cash instead for all of your purchases and bills. When you find credit card spending unavoidable, pay down your balance immediately.
Collection Agencies
The worst part of a credit crisis may be the collection agencies. Consumers can legally issue letters to collection agencies to cease and desist if they are being harassed. These letters will discourage contact from collection agencies. They can prevent collectors from continuing to call a debtor, but they do not excuse the debtor from his or her outstanding financial obligations.
Do not assume that a lawyer is being honest when he or she claims that they can fix your credit instantly. Because so many people are experiencing credit problems due to the economy, shady lawyers that advertise useless, possibly illegal credit score improvement services have appeared. Before you give a lawyer any money or any personal information, make sure to do a thorough check on them and their practice to make sure they are legitimate.
Make a plan so that you can get rid of past due bills plus any collection accounts. Until your debts are paid off, they will still appear on your report, but current payments will reduce their negative impact.
It is understandable if you are frustrated about your credit score. Use these tips to change all that. These tips will help your score stop failing and start improving.
