There are millions of bad credit scores out there today. It’s no surprise, not with a poor economy, rising living costs, stagnant wages, and a nasty employment market. The following tips are presented to help you improve your credit score and help you be more disciplined with your money.
Financing a home can be difficult if you have 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. FHA loans offer lower down payments and help with closing costs.
When your credit is so bad that you can’t get a ‘regular’ credit card, a secured one will help you to repair your credit. With a secured card, you have to fund your account before you use the card so that the bank will be assured that you will pay off your debts. If you open a credit card account, keep charges fairly low, and pay it on time, this will go towards improving your credit score.
Lower Interest Rates
When you have better credit, you will be offered lower interest rates on loans and credit cards. Lower interest rates make paying bills easier, and prevents you from incurring debt. Asking for a better deal from your debtors can help you get out of debt and back to achieving a better credit score.
Getting an installment account can help you earn money and provide a boost to your credit. Choose an installment account you can afford, since you will have to leave a certain amount of money on it at all times. If these accounts are properly managed, they can provide a quick boost to your credit score.
If someone promises you to improve your score by changing your factual history, this is a scam. It seems unfair, but accurate negative information will stick around for seven years. However, information that is not correct can be removed.
Working closely with the credit card companies can ensure proper credit restoration. Avoid collection to improve your credit score. You can even ask for help, such as pushing back the due date of your monthly payments or reducing the interest rate.
Consumers should carefully research credit counseling agencies before choosing one with which to work. There are some legit counselors, and there are some that have ulterior motives. There are a lot of people out there that are trying to take advantage of those who are down on their luck. You should always find out if a credit counselor is the real thing.
When attempting to improve your credit, you should go over any negative marks with a fine tooth comb. The debt itself may be legitimate, but if you find errors in its metadata (e.g. the date, amount, creditor name), you might be able to get the whole entry deleted.
Do not spend beyond your means any longer. This will require a change in your thinking. In recent years, easy credit has made it very fashionable for people to purchase the things that they cannot afford, and everyone is now beginning to pay the hefty price tag. Be honest with yourself about what you can truly afford.
If your credit is poor, take the first step to repairing it by closing out the majority of your cards, leaving yourself just one to use. You should arrange to make payments or make a balance transfer to your open account. In this manner, you can take care of all your credit card debt by paying down a single balance.
Payment Plan
If a creditor agrees to give you a payment plan, get that payment plan in writing. Having the plan in writing will protect you if the creditor reneges on the plan or if your debt is transferred to another creditor. If you have finished paying it off, you should request a confirmation so you can send it to the credit reporting agencies.
Now that we have gone over the different ways you can go about repairing credit, why not get started now? Act now to start on the road to improving your life by improving your credit.
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