No matter what your current situation, you have probably damaged your credit by opening one too many credit cards or being affected by the economic downturn. You are in luck, though. These tips will help you get your credit score to that mythical 850.
Getting money for a home loan can be difficult, particularly when your credit is less than perfect. If your income is a factor you may qualify for a FHA loan, which has lower standards and makes the federal government your lender in a sense. FHA loans can even work when someone lacks the funds for down payment or closing costs.
Secured Credit Card
If you want to repair your credit but do not qualify for a regular credit card, consider a secured credit card. Secured credit card applications have a high rate of approval because you must fund a security deposit against your credit limit. A responsibly used new credit card will begin healing your credit score.
Begin paying your bills to repair your credit. Your bills must be paid completely and on time. Your credit rating will quickly rise as you settle up your overdue bills.
Do not involve yourself in illegal activities. Sites may act like you can create new credit lines and tell you how to do it. This is illegal and you will eventually be caught. You could end up owing a great deal of money or even facing jail time.
Credit Score
Prior to agreeing to a debt settlement agreement, find out how that process is going to impact your credit score. Some settlement agreements can actually be bad for your credit score, so be wary and do your homework. They are just out to get their money and do not care how that effects your credit score.
If you are trying to improve your credit score but are having difficulty gaining access to new credit in order to do so, join a credit union. Credit unions have opportunities that are better than other places and are usually local.
Dispute any errors that are on your credit report so they are removed. Report any errors to the three credit reporting agencies. Be sure to include any documents to support your case. 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.
Stop spending more money than you have available. This takes a real mindset change. Unfortunately, easy credit has lured many people into buying luxuries that they don’t need and cannot afford, which will always catch up with them. Be honest with yourself about what you can truly afford.
Bankruptcy should be a last resort. It is noted on someone’s credit report for 10 years. It may sound like a good idea at the time to rid yourself of all your debt, but it will affect you later on. 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.
To accomplish getting a better rating on your credit, pay down the balances of your current accounts. You can up your credit score by just keeping your balances lower. When balances are 20, 40, 60, 80 and 100 percent of the total credit available, the FICO system takes note of it.
When you need to repair your credit score, be wary of lawyers and law offices that advertise instant credit fixes. With so many people struggling, scammers are taking advantage of their desperation by offering them fake or fraudulent credit services. Make sure any credit improvement service you consider has a positive standing with the BBB.
Sometimes you have a large number of outstanding credit bills that need your attention, overwhelming you. Take the money you have set aside for debt payments, and divide it up into portions for each debtor. Making payments, even just minimum ones, will prevent your debts from going into collection.
Create a plan to settle all of your unpaid and past-due accounts. These things will still appear on a credit report, but they will be marked paid, which is better for your credit.
If you want to fix your credit it can seem like a lot to handle, if you work hard you can do it the right way. Apply the knowledge from this article in order to assist you in repairing your credit score.
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