Your credit can easily be damaged by careless shopping sprees, too many credit cards or by an unexpected financial emergency. Don’t despair, because there are ways to get things back on track.
If you are unable to get a new card because of your bad credit, try to apply for secured cards. 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. Responsible use of a credit card can help rebuild your credit.
Try to keep a balance of less than 50% of your available credit on all of your cards. Your credit score can diminish with balances over 50%, so spread out the debt or pay off the credit cards.
Stay in touch with credit card companies if you wish to repair your score. 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.
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. Needless to say, this is against the law and you are likely to get caught. The criminal charges that you face will be very expensive, and you may also have to serve prison time if found guilty.
Before you decide to go through with a debt settlement, you should be sure you know how it will affect your credit. Research all of your options, make an informed decision about the method you chose, and only then should you agree to the settlement. They are just out to get their money and do not care how that effects your credit score.
Credit Unions
One way to increase your credit score is to become a member at a credit union. Credit unions typically offer a wider variety of credit options at better interest rates than a traditional bank. Credit unions are usually non-profit, which means better deals for you.
If you find any errors in your credit reports, you should dispute them. Send a dispute letter along with supporting documents to the credit agency that recorded the errors. When you mail your dispute package, be sure to make arrangements for confirmation of receipt. In this way, you will have documentation that your information has been received.
If you and your creditor decided to set up a payment plan, you should first get the details of the plan in written form. This is for your protection. It allows you to have valid documentation of the terms in the event that a creditor reneges on its offer or changes owners. You also want it in writing if it gets paid off so you can go ahead and send it to credit reporting agencies.
To show that you are serious about improving your credit, start systematically lowering all of your account balances. No matter what the balances are on your credit cards, pay down the highest interest rate cards first. This will show future creditors that you take your debts seriously.
Late Payments
This helps you retain a proper credit status. Late payments affect your credit report. Also late payments might prevent you from obtaining a loan should you need it in the future.
Take the time to carefully go over your monthly credit card statement. You will need to read over every charge on your account to check that it is accurate. Do not trust the credit card companies to have your back, guarantee you do not pay debt that is not yours yourself.
Do not assume that a lawyer is being honest when he or she claims that they can fix your credit instantly. Because so many people these days suffer from credit problems, attorneys and scam artists have come up with ways to charge a high price for repair schemes that can be illegal and useless. Do your homework and check out any attorney before you hire one to help with credit score improvement.
Restoring your credit rating looks at first like an uphill battle, but with sound effort and the right advice, that battle can be won. Take the advice that has been provided in this article to start making positive steps toward better credit.
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