Whether you got your credit cards on your college campus, went shopping too many times or suffered from the bad economy, you’ve probably damaged your credit. You can reverse the effects of these actions though.
If your credit is not perfect, getting a mortgage can be tricky. If you are in this situation you should look into FHA loans before speaking with a bank. If you do not have a down payment or money for closing, consider a FHA loan
There are secured credit cards available if your credit rating is too low to open up a regular credit card account. This card will be more than likely be granted to you, however you must fund the account ahead of your purchases as a sort of “insurance” to the bank that your debts will be paid. If you use it correctly, a new card can help you fix your credit.
Start by paying off credit cards with accounts 50% over your limit. You can concentrate on another card once these accounts are lowered to under half of your limit. Your credit score can diminish with balances over 50%, so spread out the debt or pay off the credit cards.
Credit Score
If your credit is good, it’s easy to get a mortgage on a new home. If you wish to have an even higher credit score, make sure that you pay your house mortgage off on time. Owning a home is a great thing to have to help with your credit score. The house secures your finances and adds to your assets. These benefits will pay off if you need to secure a loan.
Start paying on bills to help your credit. You can’t just pay whatever you want whenever you want. You need to pay your entire balance when it’s due. Getting rid of past-due bills will have a fast and dramatic effect on your credit score.
Work with the companies to whom you owe money to get your debt back under control. This will enable you to make sure to keep your credit in good standing and repair any damage that may have been caused. See if the company will allow you to modify the monthly due date, or reduce the payments.
Know how debt settlements will influence your credit score prior to making a decision. Research all of your options, make an informed decision about the method you chose, and only then should you agree to the settlement. Remember creditors want their money. They really don’t care about your credit scores. That is up to you to protect.
Dispute any errors that are on your credit report so they are removed. Compose a letter of dispute to every agency that reported errors, and include as much documentation as you can. Your letter should be sent with a request for return receipt, so you can have a record that it was received by the reporting agency.
Examine your credit card charges monthly to ensure they are correct. If there are, you will need to contact the company immediately to avoid them reporting this to a credit reporting agency,
Credit Cards
Make sure that you pay more than the minimum balance owed on all of your credit cards to improve your credit. Work on paying off credit cards that have the highest interest rates or high balances. This helps creditors realize that you are using credit cards wisely.
To protect yourself from credit card fraud, it is essential that you carefully review each monthly statement from your credit card companies. You should make sure that the charges that you get are right, and that you’re not paying for items you did not buy. You should ensure everything is okay and does not have any errors.
Having a lot of debts that you cannot pay is part of having bad credit sometimes. Spread your money among your creditors so that they each get a part of what funds are available. Paying at least minimum payments prevents creditors from calling collection agencies.
Building your credit back up is the number one way to fix a bad credit score. Prepaid credit cards help you re-establish credit without the risk of falling into an even deeper hole due to delinquent payments. Lenders look favorably towards you when you faithfully pay your bills on time.
Be aware that opening a new credit card account can affect your credit score in a negative way. Opening new lines of credit can hurt your score greatly, even if you get approved. If you fall for the temptation, your credit score will drop when opening that new card.
Be sure to document any threats that are made by a creditor or collection agency, since these are illegal. It is important that you are knowledgeable of the laws designed to protect the consumer.
If you’re having trouble with creating, or living within, a budget, consult a highly regarded consumer credit counseling agency. These services will help you communicate with creditors to make a simplified payment arrangement that will help you in the long-term. With assistance from credit counselors, you can learn valuable financial management skills while responsibly paying back your debt.
If you want to fix your credit, devise a plan of action that will help you eliminate debt. Existing debt lowers an individual’s credit rating and can be bad to have. Develop a budget that is realistic, and funnel as much money as you can toward paying your debt. Your credit score will be improved if you do not have existing debt.
It can seem impossible to repair your credit score, but just knowing what the steps are and making a plan can make it seem much less intimidating. Apply the tips you learned here and get started on your way to good credit.
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