Bad credit can really detour on the road of life. It can cause you from leading the life you desire and living your life to its full potential. There are a few steps you can do to improve and protect your credit now.
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. In order to get the card, you will have to fund the account as sort of an insurance that shows the bank your debts are going to be paid. A new credit card, used responsibly, will help repair your credit rating.
Financing a home can be made more difficult when your credit score is low. If your income is a factor you may qualify for a FHA loan, apply for an FHA loan; these loans are backed by the United States government. FHA loans are great for the individuals that do not have the financial capability to make down payments and help with closing costs.
The first step in credit repair is to build a commitment to adhere to it. You can’t just make up a commitment to making changes on how you spend money. Only buy the things that are absolutely need.
If someone promises you to improve your score by changing your factual history, this is a scam. If the information is correct, it will remain as part of your report, in most cases, for seven years. It is possible, however, to remove errant information.
You can keep your interest rates lower by working to keep your credit rating. This will make your monthly payments easier and allow you to repay your debt a lot quicker.
Interest Rates
Contact the credit card company and ask to get your card limit lowered. Not only can this tactic prevent you from getting yourself in over your head with debt, but it can also imply that you are responsible to those companies and to any future companies.
You can lower your debt by refusing to acknowledge the part of your debt that has been accrued by significantly high interest rates if you are being charged more than you should be. Creditors are skirting aspects of law when they hit you with high interest rates. You did however sign a contract saying that agrees you will pay off the debt. You may wish to make a legal claim that the interest rates are too high if you want to sue your state’s statutory limits.
You must pay your bills off on time; this is very important. Your FICO score will quickly rise as you settle up your overdue bills.
Too many credit cards is a common cause of financial strain, so close all of your accounts aside from one. Make the minimum payment each month on your other accounts, but make the largest payment possible to the one account you are focusing on. Doing this will allow you to focus on paying off one large credit card bill, instead of several smaller ones.
You should consider talking to directly with the companies from whom you have credit cards. This prevents you to make sure to keep your credit score.
Make sure you thoroughly research into any credit counselor before you do business with them. Many companies are legitimate and hold your best interests as a priority, but others may be less interested in actually helping you. Some companies you may find are nothing more than fly-by-night scams.
If you want to repair your credit, take the time to find a reputable repair agency. There are a number of shady operators in the credit repair business that can cost you money and do nothing for you. Indeed, some people have fallen prey to credit repair scams. Always read reviews online first to find a good agency.
Even if a charge held against you is legitimate, finding an error in the amount, date, may let you have the whole thing taken off your credit report.
Do not spend more than you simply cannot afford. You will have to change the way you think. In years past, people used good credit ratings to buy the items that they normally couldn’t afford, but now those risky financial choices are catching up with them. Be sure to assess your finances and find out the things that you can truly afford.
Be careful of paying for a service or a lawyer that advertises quick or instant credit repair, many of them are dishonest. Because so many people are experiencing credit problems due to the economy, shady lawyers that advertise useless, possibly illegal credit repair services have appeared. Do a thorough background check on any lawyer advertising credit repair services before handing over any money.
Check your credit card statement each month to make sure there are no errors. If there are late fees, act as soon as possible to get the matter resolved before it can affect your credit score.
Payment Plan
Repairing your credit isn’t something you can do overnight, but the best way to fix it is to slowly raise it back up. Prepaid credit cards offer you the ability to build credit while not having to worry about late payments or penalties. Potential lenders will see that you are working towards becoming more responsible with your credit.
If you and a creditor agree on a payment plan, get that payment plan in writing. Once the debt is fully paid, get a statement that verifies that the debt has been satisfied and send it to the various credit reporting agencies.
Put these ideas to use so you can repair your credit and stay on top of good credit practices. The time you invest learning about ways to repair credit can be fruitful in improving your credit rating.
Be aware that threats made by a bill collector are illegal. Find out more about laws specific to your state regarding the protection of customers.