Tackle Bad Credit With These Simple Ideas!
Posted at by CreditWiz on category Credit
With so many individuals and families suffering from the financial effects of job losses, increased cost of living, and considerable difficulty making ends meet, it is no wonder that millions are faced with unfavorable credit scores. However, the following article gives you some helpful advice on different steps you can take to clear up your debt and improve your credit rating.
Higher Balances
If you have credit cards where the balance is more than half of your credit limit, pay these down right away. Credit card balances are among the factors taken into account when determining your credit score. Maintaining balances over 50% will lower your rating. You can attain lower your balances by using balance transfers to move debt from accounts with higher balances to those with lower balances, or by simply paying off some of your higher balances.
You may be able to reduce interest rates by maintaining a favorable credit rating. Lower interest rates will reduce the amount of your monthly payment, and can also make it easier to repay your debt faster. Receiving competitive credit rates and good offers are important in having credit that you can pay off easily, and that will get you a great credit score.
An installment account is a great way to increase your credit score. You need to review the terms of an installment account carefully, because you’ll be required to maintain a certain monthly minimum. A properly managed installment account will work wonders on your credit rating.
Before consulting a counselor for credit improvement, do your research. There are a lot of unscrupulous agencies scattered in among the few legitimate credit counselors that are really there to help you. Some credit services are nothing more than fly-by-night scams. Wise consumers always verify that credit counselors are legitimate before dealing with them.
Take a look at your credit report if you have a bad score. Even though the particular credit item may not accurate, finding an error in the amount, date, or something else can cause the entire item to be stricken from your report.
Take the necessary steps to fix any mistakes that you see on your credit reports by filing an official dispute. Send a dispute letter along with supporting documents to the credit agency that recorded the errors. Mail the materials and ask the postal service for proof of delivery in order to build a record to show that the agency did indeed get the letter.
Live within your means. This is nothing short of a lifestyle overhaul. In recent years, easy credit has made it very fashionable for people to purchase the things that they cannot afford, and everyone is now beginning to pay the hefty price tag. Take a hard look at your financial situation to come up with a realistic spending plan.
To rebuild bad credit, it can be a good idea to get rid of your extra credit cards. You should only have one. You will want to either transfer your balances onto the one remaining card or set up payment arrangements, but close the account to new charges. It is much easier to manage one large monthly payment than it is to keep track of multiple smaller ones.
Always examine your monthly credit card bill to make sure everything is accurate. If there are mistakes, call the company. If the errors are not fixed, they could get reported to the major credit rating agencies.
Get a written copy of any payment plan you negotiate with a creditor. This will provide proof of your agreement in case any problems ever arise. Finally, when it is paid in full, get documentation thereof to submit to credit agencies.
Now you know how to repair your credit score, so get started on a plan of action. Be proactive and use the valuable tips you gained from this article, in order to boost your credit scores and, ultimately, increase your quality of life.