Credit Repair: How To Make It Work
Posted at by CreditWiz on category CreditThere are a lot of ways to damage your credit score, from falling for a credit card scam to just being unlucky with the recent economy. Fortunately, you can take some actions to get your credit score climbing in the right direction.
For some it may hard to finance their home due to having less than ideal credit. Try to secure an FHA loan; these are federal government guaranteed. FHA loans even apply for someone who doesn’t have closing costs or the funds that are needed for down payment.
Planning is the first step to repairing your credit. Real changes come from commitment to healthy spending habits. Purchase nothing but the essentials. If the thing you’re looking at is not both necessary and within your budget, then put it back on the shelf and walk away.
If your credit history has put you in the position where you are not able to obtain a regular credit card, you should try to get a secured credit card to begin rebuilding your credit. Most likely, you will not have a problem obtaining this type of card, but you must add funds to the account before you make any purchases to assure the bank that you will pay. If you open a credit card account, keep charges fairly low, and pay it on time, this will go towards improving your credit score.
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. Your credit score can diminish with balances over 50%, so spread out the debt or pay off the credit cards.
One thing to watch out for when trying to fix your credit is scammers who say that they can get any negative information deleted from your credit, regardless of its accuracy. Regardless of their claims, these debts will stay on your report for seven years at a minimum. Items that you can get taken off your record are those that have been reported incorrectly or unfairly.
You won’t be able to repair your credit until you are able to pay those bills. More specifically, pay them on time and in full. You will notice how quickly your credit score increases when you start paying off those overdue bills.
You need to work with the companies from whom you have credit cards. This will assure them that you want to handle your debt and keep you from getting even further behind. Don’t be afraid to ask for alterations in interest rates or dates of payment.
Before you agree to settle your debt, you need to know how your credit will stand afterwards. 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. Some debt settlement companies are only after profits and do not communicate the likely consequences of their methods.
Anything on your credit report that you feel is inaccurate should be disputed. You should compose a letter to the agencies that have made the errors, and provide proof that you are correct. Your letter should be sent with a request for return receipt, so you can have a record that it was received by the reporting agency.
The first step in credit repair is to close all but one of your credit accounts as soon as possible. You can make arrangements to pay the balances, or transfer the balances of your closed credit card accounts to your single remaining credit card. This way you can work on paying one credit card balance off, instead of a bunch of smaller ones.
At first, it may seem impossible to repair your damaged credit. However, with some effort and the right advice, you can start to improve your credit rating and eventually regain a credit score that will instill faith in any lender. Apply the knowledge from this article in order to assist you in repairing your credit score.