If you knew exactly the amount and to whom you owed the money, you might not have been in debt to begin with. But now it is time to go into damage control mode and repair your credit. The following information is quick, simple and can help repair your credit if followed correctly.
If you are buying a home it will not always be easy, and even more difficult if your credit is bad. If possible, apply for an FHA loan; these loans are backed by the United States government. You may even be able to secure your down payment and closing costs through an FHA loan. It depends on if you qualify.
The first thing you need to do before beginning to repair your credit is outline th steps required to do so, then follow those steps without deviation. You need to change your past habits and build new, better approaches to credit. Limit your purchases only to things that are absolutely necessary. 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.
Secured 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. Secured credit card applications have a high rate of approval because you must fund a security deposit against your credit limit. If you show a good history of payments with this card, it will help improve your credit standing.
A great credit score should allow you to get a mortgage on the house of your dreams. Making your mortgage payment on time each month will also boost your credit score. When you are a home owner you will be financially stable based on what you own. This will also be useful in the event that you end up needing to borrow funds.
Think about getting an installment account to save money and improve your credit score. Choose an installment account you can afford, since you will have to leave a certain amount of money on it at all times. You will improve your credit score by properly managing an installment account.
Interest Rates
Excessive interest rates can be contested. However, it is best not to sign contracts containing them in the first place. Creditors trying to charge more from you than what they originally loaned you plus a reasonable amount of interest are usually willing to negotiate. However, you have entered into a legal agreement that requires you to pay accrued interest. If you want to sue creditors, you need to state your claim that the interest rates are too high.
When you’re looking to fix your credit, be cautious of credit score improvement companies. They may tell you they can remove negative information, but if it’s correct, it can not be removed. Negative entries on your record stick around for a term of seven years at a minimum, even if you take care of the debts involved. Items that you can get taken off your record are those that have been reported incorrectly or unfairly.
Good credit isn’t worth much if you are in lockup. As we speak, people are trying to take advantage of illegal practices to have people create credit files that can get them into trouble. This tactic is not legal, and you face serious repercussions if you are caught. The legal costs can cripple you, and there is a very good chance you will be sent to jail.
You should have noticed that the preceding tips have a common theme–they are mostly based on common sense. Use the simple information from this article and you should have no trouble fixing your credit score.
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