You need to know what you owe and the companies to which you owe money before it is too late and still more debt is created. But now it is time to go into damage control mode and repair your credit. The following advice can greatly help you rebuild your credit rating.
You can easily get a mortgage if you have a high credit score. Fulfilling your mortgage obligation in a timely fashion does a great deal of good for your credit rating. When you are a home owner you will be financially stable based on what you own. This will be very helpful if the time comes where you need to take out a loan.
Installment Account
Try opening an installment account. It is necessary to at least pay the minimum, so insure the account is something that you can pay. You will improve your credit score by properly managing an installment account.
Getting a reduced interest rate is the easiest way to reduce your overall debt. In most cases, creditors are somewhat limited in the amount of interest they can charge. You did sign a contract saying that you would pay off the debt. Suing your creditors can be effective in some circumstances in cases where the court considers the interest rates to be excessive.
It is essential to pay all of your bills if you are looking to repair your credit. You should always make an effort to pay your bills on time and in full. Your FICO score will begin to increase immediately after you pay the bills that are past due.
When trying to repair your credit, research any credit counselors you consider using very thoroughly. Although some can be quite legitimate, others have motives that are less than kind. There are many scams out there. You should research any counseling service you are considering prior to initiating communications with them.
Don’t risk prison. There are plenty of credit scams that purport to erase your existing credit file and create a new one. You will be prosecuted, it is against the law. Legal repercussions will cost you a lot of money, and you could go to jail.
Joining a credit union may be a way to boost your credit score when you are having a hard time getting credit. These credit unions can probably give you better credit options in the long run.
Officially dispute any errors you find on your credit reports. Create a dispute letter for agencies that have the error, and submit additional supporting documents along with it. 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.
Take a look at credit card bills to make sure that every item is one you have charged. If there are late fees, you have to make sure that you take care of them immediately with the company so that they don’t send that information to the credit bureaus.
Get a written copy of any payment plan you negotiate with a creditor. 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. When the debt is eventually paid or settled in full, you should request documentation of this and forward copies to the primary credit reporting companies.
When you receive a credit card statement you should immediately look at the statement. It’s up to you to ensure that the charges on your bill are correct and that you haven’t been double charged, overcharged or charged for something you didn’t buy. It is solely your responsibility to be sure that everything is correct.
Attempts to defend negligence or bad credit will not succeed, even if they are justifiable. The creditors are only worried about results and numbers. Inclusion of the defending statement could actually have the opposite effect as it brings more attention to the fact that you have a negative mark on your report.
Collection Agencies
One of the most stressful aspects of handling bad credit is dealing with debt collection agencies. Cease and desist instructions can be used to ward off debt collectors to a point, but only really to prevent harassment. You will still have to pay what you owe even if collection agencies stop calling you.
Do not trust anyone who promises you miracle results. 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. Get reviews on a lawyer before you go to them for help.
It is illegal for debt collectors or companies to threaten you. If this happens, be sure to document it. You should be aware of the laws that safeguard consumers’ rights when dealing with debt collectors.
Reduce your total debt. Potential creditors will look at your debt to income ratio. If you have more debt than your income allows you to pay, you are a credit risk. The average person can not pay off their debt immediately. A good payment plan is essential to get any debt paid off as soon as possible.
It is easy to get out of debt if you are patient and have common sense. This information puts the lie to that notion, so start repairing your credit today.
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