Has your bad credit been giving you problems? Current economic conditions are affecting a lot of people’s credit. Thankfully, bad credit isn’t forever. Use these tips to learn how to repair your credit once and for all.
Any credit cards that have balances over 50% of your limit should be paid off until they are less than 50% of your limit. If you owe more than half of your credit limit on any credit card, this will have a negative impact on your rating. Plan to pay down that card as soon as possible, or see about transferring some of that debt.
You can reduce your interest rate by maintaining a high credit score. Monthly payments are easier this way, and you can pay off your unpaid debt. Receiving competitive credit rates and good offers are important in having credit that you can pay off easily, and that will get you a great credit score.
Installment Account
Improve your credit score, as well as make some profit, through an installment account. Choose an installment account you can afford, since you will have to leave a certain amount of money on it at all times. Your FICO score will rise over time, if you responsibly manage this type of account.
If you find that you have a credit card and the interest rate has gotten to high, you do have the option to not pay the debt, though there will be consequences. There are laws that protect you from creditors that charge exorbitant interest rates. However, you have entered into a legal agreement that requires you to pay accrued interest. Be very wary of suing your creditors, especially if all of your issues were covered in the contract.
Credit Card Company
When trying to rehabilitate your credit, it is important to work with each credit card company you are indebted to. If you do this you will not go into debt more and make your situation worse than it was. Do not be afraid to call your credit card company and ask if you can make changes to your due date or your minimum payment amounts.
Joining a credit union is beneficial if you want to make your credit score better but cannot get new credit. Credit unions have opportunities that are better than other places and are usually local.
If you see errors on your credit reports, dispute them with the credit agency. Send a dispute letter along with supporting documents to the credit agency that recorded the errors. Ask for a return receipt so that you can prove that the agency got your package.
If you are living beyond your financial ability, stop now. You need to change your way of thinking in this regard. In many cases, people are using credit cards to buy things they want, rather than focusing on things that they need. Instead of spending more than you can afford, take a long hard look at your income and expenses, and decide what you can really afford to spend.
Be certain to get any credit repayment plan in writing. This is a great way to have documentation of the plan if the creditor changes their mind or the company ownership gets changed. Once the debt is fully paid, you need to get a statement verifying this from the creditor and send it to each of the major credit bureaus.
Carefully read the small print on your statements. Go through line by line for accuracy, and to prevent getting charged for an item or service you did not actually get. It is solely your responsibility to be sure that everything is correct.
You may want to justify yourself, but the statement has no effect on whether a lender will extend credit to you or not. It is irrelevant. Trying to defend bad credit may actually draw their attention to the area and cause more problems than it would have originally.
Don’t use credit cards a lot. Instead use cash for all your purchases. If you are forced to use credit, pay it back immediately.
Good credit starts with rebuilding. Prepaid credit cards can help you demonstrate responsible use of credit without having to worry about missing payments or late fees. You will prove to creditors that you can pay your bills.
Credit Score
You can use the following advice to improve your credit score. Stop your credit score from spiraling downward, and look for ways to get back on track.