It can be stressful to deal with having bad credit. It is especially frustrating when you are haunted by bad decisions from your past. Rebuilding a good credit score is an uphill climb, but the trail does exist. Keep reading for more helpful tips.
If you have a poor credit history and can’t qualify for a credit card, get a secured card. Most likely, you will not have a problem obtaining this type of card, but you must add funds to the account before you make any purchases to assure the bank that you will pay. A new credit card, used responsibly, will help repair your credit rating.
Look at the credit card accounts you have with a balance over 50% of the credit limit. Pay those off until they fall under this number. Creditors like to see you using your accounts, but still keeping your balances under 50% of your allotted credit.
Avoid paying off high interest rates so that you don’t pay too much. You may be able to challenge an interest rate that is extremely high. You did sign a contract saying that you would pay off the debt. Be very wary of suing your creditors, especially if all of your issues were covered in the contract.
If credit score improvement is something you are investigating and a company has told you they can strike true, but negative, information off of your credit report, they are lying. It seems unfair, but accurate negative information will stick around for seven years. Know, however, that it is possible to delete information that is actually wrong.
The first step to repairing your credit is paying what you owe. Even more important than just paying your bills, is to pay off the entire balance, and pay them on time. You will notice how quickly your credit score increases when you start paying off those overdue bills.
When you are trying to clear up your credit contact your credit companies. When you work with company you are not working against anyone, including yourself. This will help prevent furthering yourself into debt. You can even ask for help, such as pushing back the due date of your monthly payments or reducing the interest rate.
Don’t attempt to fix your credit in a way that will result in you breaking any laws. There are scams all over the web that teach you how to create a new credit file. Do not think that you can get away with illegal actions. Taking these short cuts will end up costing you money and could lead to a stay in jail.
Credit Unions
Credit unions are an option for those who have run out of options. Local credit unions might have different credit products than national banks, because they can focus on local market conditions.
Avoid bankruptcy at all costs. Bankruptcies appear on credit reports for ten years. It might seem like a good thing but you will be affected down the line. You may never get a line of credit for any purchases you might need to make if you go ahead, give up on repairing your credit and file for bankruptcy.
One of the biggest stressors can be bad dealings with debt collection agencies. You can use a cease and desist letter to stop any harassment from collection agencies. This doesn’t let the customer off the hook for the debt, it merely stops the threatening calls.
A good way to repair your credit is to begin to build it back up. Prepaid credit cards help you re-establish credit without the risk of falling into an even deeper hole due to delinquent payments. A potential lender will see this as a responsible move on your part, showing that you are credit worthy.
Be sure to document all information if a collector threatens you; this is not legal. There are consumer laws which limit the things that a collection agency can do to you.
If you follow the advice in this article, you will be on the right track to rebuilding your credit score. Consistency is crucial with this process, so be sure to stay up to date with your obligations. It’s definitely possible to repair your credit, so don’t worry and get going!
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