Is worry about your credit report so bad that it keeps you from getting a good nights sleep? The following advice will help in the path to getting your credit and ease your mind.
Planning is the first step to repairing your credit. You must be committed to making real changes in the way you spend money. Pay cash for things, and cut out unnecessary expenses. Ask yourself how necessary each purchase is, and how affordable it is too. If you can’t answer “yes” to each of the questions above, you need to reconsider the purchase.
Financing a home can be made more difficult if you have bad credit. If possible, try to get a FHA loan because there is a guarantee that it will be given to you. FHA loans are also great when someone lacks the funds for down payment or pay closing costs.
Credit Card
A respectable credit score makes it much easier for you to purchase a home with a mortgage. By paying off your mortgage on time, you will even improve your credit score further. Credit rating companies will judge you a reliable risk when you have verifiable assets such as a home. Having a good credit score is a key factor if you ever need to take out a loan.
If your credit history has put you in the position where you are not able to obtain a regular credit card, applying for a secured credit card is an option. If you show a good history of payments with this card, you will go a long way in repairing your credit.
If your credit card has a balance of over 50% of your limit, you must continue to pay on them until the balance is lower than 50% of the credit limit.
Getting a reduced interest rate is the easiest way to reduce your overall debt. Creditors who charge exorbitant interest may be just a law suit away from having to wipe the slate clean. On the other hand, you’re likely bound by a contractual agreement to pay any interest charged by lenders. You can consider suing your creditors if the interest rates are outrageously high.
Credit Score
You will be able to buy a mortgage if you have a high credit score. Making regular mortgage payments in a timely manner helps raise your credit score. This will also be useful in the event that you need to borrow funds.
Contact the credit card issuer with a request to lower your card’s limit. 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 a fine line of the law when they try to charge you with high interest rates. You did however sign a contract that agrees you will pay interest. You may wish to make a legal claim that the interest rates are too high if you want to sue your lenders.
You must pay your bills off on time and in full. Your FICO score will begin to increase immediately upon paying off some of your past due bills.
Officially dispute any errors you find on your credit reports. Include proof along with a letter disputing the claim to the agency that recorded the errors. Make sure that you send the letter via recorded delivery, so that you can prove that the credit agency receives it.
Make sure you thoroughly research a credit improvement agency or counselor before you do business with them. There are some legit counselors, while others are basically scammers. Some credit services are not legitimate.
Be wary of programs that do not sound legal; chances are they aren’t. There are many different places that claim they can help you how to establish an additional credit profile. Do things like this because it’s illegal; you into big trouble with the law. You could go to jail if you are not careful.
Do everything you can to avoid bankruptcy. Bankruptcy will be noted on the credit report for 10 years, afterwards you must rebuild from scratch. Bankruptcy may sound great because your debt goes away but there are consequences. If you do file for bankruptcy, it will be extremely difficult to get approved for a loan or a credit card for many years, if ever.
Do not use credit cards to pay for things that you can afford. This will require a change in your lifestyle. In many cases, easy credit has made it very fashionable for people to purchase the things that they cannot afford, and they are now currently paying big payments. Be honest with yourself about what you can afford.
If you use the sound advice in the article above, your bad credit will no longer give you bad dreams. You are able to fix your credit rating and overcome any obstacles in your way. These tips can help you achieve a credit score you can be proud of.
Do not carry high balances on any of your credit accounts. You can improve your score by lowering your balances. When balances are and increments of twenty percent of your total available balance on that account, the FICO system will take note.