Credit Repair To Improve Your Credit Rating
Posted at by CreditWiz on category CreditDeveloping a low credit score is easy to do, but difficult to remedy, leading to financial barriers that are hard to surmount. Bad credit and keep you from great opportunities as they arise. Follow these tips to start repairing your credit.
Getting home finance can be quite tough when your credit rating is not good. An FHA loan can be helpful in such a case since the federal government backs these loans. You may even qualify for an FHA loan if you don’t have enough money for a down payment or the closing costs.
If you’re credit needs some work, first you should make a plan you can stick with, and then follow through. You must be committed to making real changes in the way you spend money. 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?
Pay down any credit cards with a balance in excess of 50%, preferably getting them down to 30%. When your debt is over 50%, credit ratings usually go down. With that said, try to spread out the debt that you have or try paying it off.
If someone promises you to improve your score by changing your factual history, this is a scam. It seems unfair, but accurate negative information will stick around for seven years. However, information that is not correct can be removed.
Prior to agreeing to a debt settlement agreement, find out how that process is going to impact your credit score. There are ways to go about this that will have less of an impact and should be learned about before you make any kind of deal with a creditor. Some debt settlement companies are only after profits and do not communicate the likely consequences of their methods.
Dispute any errors that you find on any of your credit reports. Write a dispute letter to any agencies with recorded errors, and include supporting documents. Make sure that you send the letter via recorded delivery, so that you can prove that the credit agency receives it.
Try to pay down all of your debts until you’re only carrying a balance on one. Making one monthly payment will be easier than paying off different bills. By doing this, you can work towards completely paying off one credit card with a large debt, rather than working piecemeal with many smaller debts.
Check your credit card statement each month and make sure there aren’t any discrepancies. Contact the credit card company right away if there are incorrect fees, so that they won’t be on your credit report.
Make sure you will get a plan in writing if you decide a payment plan is the best option for you with your creditor. This will protect you should the company change its policies. Once you finish making all your payments, be sure to send that information to the credit agencies in writing.
Try not to file for bankruptcy. It can adversely affect your credit for up to 10 years. It might seem like a good thing but you will be affected down the line. If you choose to file bankruptcy, you’ll be unable to get a credit card or loan in the future.
To show that you are serious about improving your credit, start systematically lowering all of your account balances. Always pay off the card with the highest interest rate first and then work you way down. By doing this, you will show your creditors that you are trustworthy with your credit.
It is important to read all credit card statements you receive. You should make sure that the charges that you get are right, and that you’re not paying for items you did not buy. You are responsible for the accuracy of information on your credit card statments.
Easy tips, like the ones in this article, will help you repair your credit and keep it healthy in the future. Credit rating affects your life in many ways, so make sure to learn all you can about it.