Credit Repair Can Be Difficult, These Tips Can Help
Posted at by CreditWiz on category Credit
You can feel victimized by bad credit. You might have had a bad time or made some mistakes but you can move forward. Fortunately, there are some things you can take action on right now to raise your credit score, so read on and get ready to regain control of your credit.
If you have a poor credit rating, it can be extremely difficult to obtain a mortgage loan for a home. In this situation, it is a good idea to try to obtain an FHA loan, because these loans are guaranteed by the federal government. FHA loans even apply for someone who doesn’t have closing costs or the funds that are needed for down payment.
Fixing credit reports must begin with a solid working plan that you are capable of adhering to. You have to be committed to making real changes to your spending habits. Pay cash for things, and cut out unnecessary expenses. Put each potential purchase to the test: is it within your means and is it something that you really need?
Credit Card
If you want to repair your credit but do not qualify for a regular credit card, consider a secured credit card. You will most likely be approved for this type of card, but you will have to add money to the card before you can use it so the bank will know that you can pay for all of your purchases. If you show a good history of payments with this card, it will help improve your credit standing.
Try to negotiate with your creditors about the amount of interest you’ll pay on an old debt. Creditors are skirting a fine line of law when they try to charge you exorbitant interest rates. However, you signed a contract agreeing to pay off interests. If you’re going to try taking your creditors to court, make sure you can prove the interest rates they charged were excessively high.
When you are trying to fix your credit record, call your creditors and make payment arrangements that will benefit both of you. By keeping the lines of communication open, you will avoid getting into more debt, making your credit score even worse. Do not be afraid to call your credit card company and ask if you can make changes to your due date or your minimum payment amounts.
Joining a credit union can give you opportunities to increase your credit score. Credit unions focus more on the local situation instead of the national one, and may provide more options or rates that are more favorable than those of a larger bank.
The first step in credit score repair is to close all but one of your credit accounts as soon as possible. Making one monthly payment will be easier than paying off different bills. This way you can work on paying one credit card balance off, instead of a bunch of smaller ones.
It is important to get any payment plan that you agreed to with a creditor in writing. Any plan that you agree on should be put in writing and signed by both parties to protect you in the future. 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.
Filing for bankruptcy is a bad idea. Doing so will reflect upon your credit score and report for 10 years. Though the idea of ridding yourself of debt can sound appealing, the long term consequences just aren’t worth it. You may not qualify for auto financing or a credit card after filing for bankruptcy protection.
Pay off any balances as soon as you can. First, pay down your credit card balances, starting with the highest interest. This shows creditors you are responsible about your credit cards.
Bad credit can really get you down in the dumps. The credit score repair tips in this article can get you in a new frame of mind, and make the first steps to improve your credit.