It is stressful to have low credit since it stops you from doing important things. It is much more frustrating when you’re reminded of bad decisions you made in the past. Rebuilding your credit is a challenging process, but it can be done. These suggestions can help.
If you are unable to get an unsecured credit card due to your low credit rating, consider a secured card to help reestablish your rating. Anyone can get one, but you must load money onto the card as a type of “collateral”. Using this new credit card in a responsible manner will help to build back up your good 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. You should keep your balances under fifty percent; anything over this and you can lower your credit rating, so spread out the money you own and pay down your credit cards.
Consumers should carefully research credit counseling agencies before choosing one with which to work. Some counselors truly want to help you, while others are untrustworthy and have other motives. Others are just plain fraudulent. It is smart to verify the legitimacy of credit counselors prior to getting involved with them.
Do not try something that you do not know is legal or illegal. A common scam involves teaching you how to make a completely new, albeit fraudulent, credit file. This is illegal and you will eventually be caught. Not only can legal fees add up, but you could end up in jail.
Credit Card
Give your credit card company a call and ask them to lower the limit on your credit card. By doing this it will stabilize you in your financial boundaries instead of letting you extend beyond what you really should.
If you find any errors on your credit reports, dispute them. You should compose a letter to the agencies that have made the errors, and provide proof that you are correct. Mail the materials and ask the postal service for proof of delivery in order to build a record to show that the agency did indeed get the letter.
If you are living beyond your financial ability, stop now. You need to change your way of thinking in this regard. If you’re buying flashy items to boost your reputation, consider that a smart person who isn’t being chased by collectors will have an even better reputation! Be realistic about the lifestyle your income affords you.
When you get your monthly credit card bill, check it over to see if there are any mistakes. If there are mistakes, call the company. If the errors are not fixed, they could get reported to the major credit rating agencies.
Making your payments on time shows lenders that you are serious about maintaining good credit. Anytime you don’t make a payment on time it can damage your credit and it can be hard to get a loan anywhere.
Collection Agency
One of the biggest stressors can be bad dealings with debt collection agencies. If a debt collection agency is harassing you, writing a cease and desist letter can stop the harassment. A letter like this may stop a collection agency from harassing you, but you are still on the hook to pay your debts.
If you are trying to fix your credit, be aware of lawyers who claim to instantly fix your credit. With so many people struggling, scammers are taking advantage of their desperation by offering them fake or fraudulent credit services. Do your homework and check out any attorney before you hire one to help with credit score improvement.
Part of a nasty credit crunch is having multiple debts that you do not have the money to pay. When you do have money to apply to your debt, spread it among all of the creditors so that each one gets a little. Making the minimum payments will, at least, avoid ending up with collection agencies.
The only way to repair credit is to be more responsible with your credit accounts. Prepaid credit cards offer you the ability to build credit while not having to worry about late payments or penalties. Potential lenders will see that you are working towards becoming more responsible with your credit.
Credit Score
Whenever you apply for and open a new credit account, your credit score may drop. Resist the urge to sign up for credit cards even when they promise you instant savings at the checkout. As soon as you open a new credit line, your credit score drops.
If you are threatened by a collection agency or debt collector, make a note of it, as what they are doing is illegal. You do not have to deal with it; there are many laws that will protect you.
If you follow the advice you have been given, you will make great progress in repairing your credit score. The most important thing is to be consistent with the process and make sure that you stay on top of your obligations. Stop worrying and start repairing your credit score now!
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