It can be stressful to have to deal with a negative credit score. If you have made some bad choices in the past, it can be even more frustrating. Although getting your credit back up to speed can be difficult, there is no reason why it cannot be done. Read on for some tips that can help.
Financing a new home can be a challenge, especially if you have a history of bad credit. 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. Some FHA loans even cover a down payment or your closing costs.
Credit Cards
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%. When balances are over 50%, your credit rating goes down significantly, so try to either spread out your debt or, ideally, pay off your credit cards.
You can receive a better interest rate if you have excellent credit. You’ll be able to make your payments more easily and get your debt paid off quickly. The key to paid off credit is to find a great offer and a competitive rate so that you can pay off your debt and get a better credit score.
Excessive interest rates can be contested. However, it is best not to sign contracts containing them in the first place. There are legal limits set in place to control the amount of interest a creditor is allowed to charge you, plus your original debt is all the credit card company paid when you made the purchase. Keep in mind that you did sign a contract agreeing that interest rates were acceptable. If you want to sue creditors, you need to state your claim that the interest rates are too high.
A good tip is to work with the credit card company when you are in the process of repairing your credit. Maintaining contact shows your good faith and can help you minimize further debt. Talk to your credit card company about changing the terms of your monthly payment.
Credit counselors should always be researched thoroughly before being consulted for credit restoration. Some counselors truly want to help you, while others are untrustworthy and have other motives. Other programs, while they sound good, are complete and total scams. Knowledgeable purchasers will always make sure that the credit counselor in question is legitimate before hiring.
If you are able to successfully negotiate a payment schedule for a debt, it is important to request a copy of the agreement in writing. This is for your protection. It allows you to have valid documentation of the terms in the event that a creditor reneges on its offer or changes owners. You also want it in writing if it gets paid off so you can go ahead and send it to credit reporting agencies.
Do not file for bankruptcy. Doing so will reflect upon your credit score and report for 10 years. It sounds very appealing to clear out your debt but in the long run you’re just hurting yourself. Filing bankruptcy makes it difficult if not impossible to get anything involving credit, like credit cards and loans, in the future.
Pay off your entire balance on your credit card in order to repair your credit. Pay off high-interest debt first, as it grows the fastest. By doing this, you will show your creditors that you are trustworthy with your credit.
When you receive a credit card statement you should immediately look at the statement. Make sure that all of your fees and charges are correct and that there are not any items that were not authorized by you. You are the only one that can verify if everything on there is the way it should be.
Credit Score
If you want a higher credit rating, you will need to bring down the balance on any existing accounts. Your credit score can be raised just by reducing your balances. Your FICO credit score notes what your balances are on your revolving accounts based on the credit you have available.
Avoid using credit cards. Pay with cash whenever possible. 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.
Debt collection agencies can be the most stressful part of a bad credit crisis. Remember that when dealing with harassing collection agencies, consumers have the option to issue a cease and desist letter to stop the harassment. Although these letters make collection agencies cease contacting people, they are still expected to pay their debts.
Using the tips from this article will make a dramatic improvement towards your credit score. Being consistent in the process and honoring your obligations are the most important things to remember. Clawing back from a credit disaster is doable, so stop making excuses and start today!
This is a limited-time offer. We are not able to guarantee availability if you wait!
