Repair Your Credit With These Easy Tips
Posted at by CreditWiz on category CreditBad credit is a very frustrating thing to deal with. A low score will close the doors on many financial options and stop you from being able to make your own choices in life. There are a few steps you can take to start repairing your credit now.
Getting money for a home loan can be difficult, particularly when your credit is less than perfect. If you are in this situation you should look into FHA loans before speaking with a bank. It might be possible to get an FHA loan even if you don’t have the money for a down payment or the closing costs involved.
Fixing credit reports must begin with a solid working plan that you are capable of adhering to. You must make a commitment to making changes on how you spend money. Only purchase something if you cannot live without it. Before purchasing an item, ask yourself if it is absolutely necessary and well within your financial means. If you cannot answer each of these in the affirmative, do not buy the item.
Start by paying off credit cards with accounts 50% over your limit. You can concentrate on another card once these accounts are lowered to under half of your limit. Any time you exceed 50% of your credit limit, your credit rating is affected. Pay off credit cards as fast as you can, or spread the debt out further.
Opening up an installment account will help you get a better credit score and make it easier for you to live. All installment accounts must stay above the set monthly minimum, so only open one if you can afford it. Paying on time and maintaining a balance will help improve your credit score.
If you don’t want to pay too much at a time, you can avoid paying higher interest rates than you started with. There are laws that protect you from creditors that charge exorbitant interest rates. Remember you agreed to pay any interest that accrued over the life of the account. The only way you are legally able to sue the creditors is if you are able to prove that your interest rates are much too high.
Before consulting a credit counseling agency, be sure to check out their background and history. There are some counselors that are real, while others are basically scammers. Also be aware that there are other credit counseling services run by dishonest people. These services are scams and should be avoided at any cost. Smart consumers will always check to see that credit counseling agencies are, in fact, legitimate before working with them.
Prior to agreeing to a debt settlement agreement, find out how that process is going to impact your credit score. There are ways that are less damaging than others, that is why it is important to research about it before starting an agreement with creditors. Creditors are only trying to get the money that you owe them and could care less how that hurts your credit score.
Check any negative items on your reports carefully when you begin fixing your credit. If you notice a mistake on your report, you could get some items crossed off. Even if the item itself is right, an error in the date or amount gives you the right to contest it.
If you find any errors on your credit report, you should dispute them. Contact the credit agency in writing, with documentation to support the errors that you are disputing. 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.
It is crucial that you review credit card bills on a monthly basis to check for errors. If there are, you will need to contact the company immediately to avoid them reporting this to a credit reporting agency,
These tips will help you on your way. You can repair your credit issues and enjoy a brighter, more financially sound future. A good credit score is essential to financial freedom, take the time to learn about fixing your credit.