Poor credit is a terrible thing for you to deal with as you journey through life. It can rob you of your financial options and prevent you from taking advantage of great opportunities. You can repair it though, and make steps to prevent it from spiraling down further.
Creating a payment plan and sticking with it is just the first step to getting your credit on the road to repair. Be totally committed to changing your spending habits. Don’t buy anything unless you absolutely need it. If you are buying something because you want it, and don’t need it, put it back on the shelf.
Credit Card
If your credit card has a balance of over 50% of your limit, it should be your number one priority to pay it off until the balance is under 50%. If your credit card balances exceed 50% of their limits, it will lower your credit score, so spread your debt over multiple cards, or better, pay down the balances.
If you are looking to repair your credit, then you should not believe a company if they promise they can remove negative information from the report. Specifically if this information is correct. It seems unfair, but accurate negative information will stick around for seven years. It is possible to have erroneous information removed from your report, however.
Contact the credit card company and ask to get your card limit lowered. This will prevent you from spending too much that you do not have. It will also show the credit companies how responsible you are, and if you do need to get more credit in the future, you will have a much easier time.
Before you agree on an agreement for settling your debt settlement, you should determine what affect this will have on your credit score. Some debt settlements are better than others. Do your homework and find out how your score will be impacted before agreeing to anything. Many collectors just want to get paid and don’t care about credit consequences.
Too many credit cards is a common cause of financial strain, so close all of your accounts aside from one. You should plan on how you will pay the remaining open balances, or how to consolidate them into one account. By doing this, you can work towards completely paying off one credit card with a large debt, rather than working piecemeal with many smaller debts.
Credit Card
Taking time to examine your monthly credit card bill is critical to ensure that there are no errors. If such fees are present, you need to get in touch with the credit card company right away to avoid adverse action.
If you wheel and deal and get a new payment plan, be certain to have it on paper. This is a great way to have documentation of the plan if the creditor changes their mind or the company ownership gets changed. If you have finished paying it off, you should request a confirmation so you can send it to the credit reporting agencies.
Bankruptcy should be filed only if absolutely necessary. Doing so will reflect upon your credit score and report for 10 years. It may seem like the right things to do, but your future will be affected. Filing for bankruptcy will make it very difficult for you to qualify for credit in the future.
It is important to read all credit card statements you receive. You will need to read over every charge on your account to check that it is accurate. You bear the responsibility for looking after your own best interests, and you are the only person who will know if your statement is accurate.
To keep your credit in good standing and get a better score, maintain a low balance on revolving accounts. Lowering your balances is one way to get a better credit score. The FICO system notes when balances are at 100, 80, 60, 40 and 20 percent of your total credit available.
There are many credit improvement agencies advertised; you must check with places like the Better Business Bureau to make sure that you deal with a reputable one. There are far too many of these companies that are quite simply fraudulent. There are numerous people that have been the victims of credit restoration scams. Be a smart consumer and educate yourself by researching user reviews online to find a good agency.
If you are having a lot of trouble with your credit, consider locking up your credit cards for a while. Try to make purchases using cash only. If you absolutely have no other choice but to use a credit card, pay off the balance in full as soon as possible.
Put together a plan to pay off the collection account and past due accounts. These accounts will still appear on a credit report, but they will be earmarked as paid.
Credit Counseling
If you are having a hard time sticking to your budget, contact a credit counseling agency for help. These companies often cooperate with your creditors so you can have a good repayment plan and improve your finances. Consumer credit counseling services can provide you with effective ways to better manage your money and pay off debt.
Put these ideas to use so you can repair your credit and stay on top of good credit practices. A good credit score is essential to financial freedom, take the time to learn about fixing your credit.
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