Having poor credit can be a devastating occurrence in life. It can take take away choices and stop you from enjoying wonderful opportunities. But a few easy steps can help you repair your credit and guard it in the future.
If your credit history has put you in the position where you are not able to obtain a regular credit card, you should try to get a secured credit card to begin rebuilding your credit. This card is very easy to get, because you put money into an account ahead of time and then spend from that, so the bank doesn’t have to worry about not getting their money. By using a new card responsibly, your credit rating will start to increase.
Interest Charges
If your debt includes large amounts for interest charges contact the debt collector and see whether you can pay the original debt and avoid some of the additional interest charges. 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. You may wish to make a legal claim that the interest rate charged exceeded your state’s statutory limits.
If a company promises that they can remove all negative marks from a credit report, they are lying. Negative credit information remains on your record for up to seven years. Incorrect information may be erased though.
You won’t be able to repair your credit until you are able to pay those bills. More specifically, pay them on time and in full. Your credit score starts to improve immediately upon paying off some of your past due bills.
Be very wary of programs that do not sound legal; chances are they aren’t. There are various online scams that involve creating a fresh credit file. Doing this is illegal, and you will be caught. Penalties can include large fines and possibly even incarceration.
Make sure to have as low as possible of a credit line available to 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.
Try joining a credit union to begin a credit score. Credit unions often offer better interest and more options than chain banks do.
Start living within your means. You need to change your way of thinking in this regard. A lot of people rely on credit to maintain an unrealistic lifestyle, but when the credit runs out, all that’s left is a very big bill. Be sure to assess your finances and find out the things that you can afford.
Credit Card
Too many credit cards is a common cause of financial strain, so close all of your accounts aside from one. You can make arrangements to pay the balances, or transfer the balances of your closed credit card accounts to your single remaining credit card. You can pay down one credit card in full, rather than chipping away at many.
Always examine your monthly credit card bill to make sure everything is accurate. If you notice unwarranted fees or surcharges, contact the credit card company to avoid being reported for failure to pay.
Make sure you will get a plan in writing if you decide a payment plan is the best option for you with your creditor. This is the only way that you have of protecting yourself. 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.
Bankruptcy should be a last resort. This will have damaging consequences to your credit score for ten years. It may sound like a good idea at the time to rid yourself of all your debt, but it will affect you later on. Bankruptcy destroys your ability to get any sort of loan for at least a few years, so don’t file unless you have to.
These tips can help you repair your credit and keep it high. A good credit score is essential to financial freedom, take the time to learn about fixing your credit.
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