Weeping Wallets: Advice For Credit Score Improvement Snafus
Posted at by CreditWiz on category Credit
Knowing what you owed and to whom it was owed may have prevented you from incurring the debt in the first place. But now it is time to go into damage control mode and repair your credit. The tips in this article will help you repair a low credit score.
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. The account is funded in advance, which provides the lender with a level of insurance against unpaid debts. This is why secured cards are often easier to get. Using this new credit card in a responsible manner will help to build back up your good credit rating.
Credit Card
Pay down the balance on any credit card that is 50% or more of the credit limit. Any balances that are over half your limit drag your credit rating down. So be sure to pay your credit card down or, if you can not, try to use another credit card.
Be wary of credit score improvement scams that can get you in legal trouble. There are various online scams that involve creating a fresh credit file. Of course, this highly illegal, and it will cause you even more problems, because it will not go unnoticed. Legal ramifications can cost a lot, and you may go to jail.
Before you agree to enter a debt settlement, learn about what happens to your credit as a result of it. Certain methods of settling your debts have less detrimental effects on your credit history. The creditor is only interested in receiving the money due, and is not concerned with your credit score.
Find and challenge errors on your credit report using the dispute process offered by each credit reporting agency. Gather your support documents, make a list of the errors, and compose a letter to pertinent agencies. Mail your dispute documents to the agency using certified mail and a return receipt so that you can prove the agency received them.
If you are currently spending more than you earn, you need to quit that immediately. This is nothing short of a lifestyle overhaul. In years past, many people relied on credit cards to make major purchases, but now those risky financial choices are catching up with them. Take a realistic look at your financial situation and determine how much you can actually spend.
Try not to file bankruptcy if at all possible. Bankruptcy will be noted on the credit report for 10 years, afterwards you must rebuild from scratch. This may appear to be a wonderful idea where you rid yourself from all this debt at once, but in actuality it causes more harm than good. Bankruptcy destroys your ability to get any sort of loan for at least a few years, so don’t file unless you have to.
Make sure that you pay more than the minimum balance owed on all of your credit cards to improve your credit. Always pay off the card with the highest interest rate first and then work you way down. This effort will show the credit card companies that you are trying to pay your bills and be responsible.
It is important for you to thoroughly look over your monthly credit card statements. 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. You are the only person that is responsible for making sure the statements are error free.
Debt Collection
One of the most stressful aspects of handling bad credit is dealing with debt collection agencies. If a debt collection agency is harassing you, writing a cease and desist letter can stop the harassment. You may be able to stop the deluge of calls from a collection agency, but the debt must still be dealt with.
Repairing your credit rating and cutting down your debt involves a lot more common sense than anything else. You can easily achieve your goal by using these tips.