Good Credit Is Important- Try These Credit Repair Tips
It is likely you have done something to damage your credit rating at some point in your life, whether it was a shopping spree, a predatory loan or just being a victim of bad economic luck. Fortunately, you can take some actions to get your credit score climbing in the right direction.
Develop a plan that works if you are in need of credit repair. You need to change your past habits and build new, better approaches to credit. Only purchase something if you cannot live without it. 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 you can't get a normal card due to low credit score, look into a secured card. Most likely, a secured credit card will be easy for you to get, but you have to fund the credit account before you purchase so the bank knows that you won't miss any payments. If you show a good history of payments with this card, it will help improve your credit standing.
Look at the credit card accounts you have with a balance over 50% of the credit limit. Pay those off until they fall under this number. If your credit card balances exceed 50% of their limits, it will lower your credit score, so spread your debt over multiple cards, or better, pay down the balances.
Paying off any debts you have that have high interest rates can help you to avoid paying too much. There are legal limits set in place to control the amount of interest a creditor is allowed to charge you, plus your original debt is all the credit card company paid when you made the purchase. Keep in mind that you did sign a contract agreeing that interest rates were acceptable. Be very wary of suing your creditors, especially if all of your issues were covered in the contract bad credit loan companies.
A good tip is to work with the credit card company when you are in the process of repairing your credit. This will help you stabilize your situation and start working towards a better financial situation. You can even ask for help, such as pushing back the due date of your monthly payments or reducing the interest rate.
Don't risk prison. Sites may act like you can create new credit lines and tell you how to do it. Of course, this highly illegal, and it will cause you even more problems, because it will not go unnoticed. You could end up owing a great deal of money or even facing jail time.
If you are trying to repair your credit, check all of your negative reports very carefully. If you find errors in any of the information, you might be able to request the entire negative record be removed from your credit report.
Dispute any errors that you find on any of your credit reports. You should contact the credit bureaus both online and by certified letter; be sure to include proof of your claims. Include a request for a return receipt with the dispute package so that you can prove it was received by the appropriate agency.
Do not spend more than you can afford. You will need to change the way you think about spending money. In the last decade, it has been way to easy for people to get credit. Many people have used this credit to buy items that they really could not afford at the time, and are now paying the price. Take a realistic look at your financial situation and determine how much you can actually spend.
If you are able to successfully negotiate a payment schedule for a debt, it is important to request a copy of the agreement in writing. This is a great way to have documentation of the plan if the creditor changes their mind or the company ownership gets changed. Upon completion of payment, make sure to get the receipt in writing and send it to the credit reporting agencies.
Addressing a bad credit report might seem daunting at first, but if you learn the tricks and stick to the process, you can improve your credit dramatically. With the tips above, you are better prepared to take action and get your credit situation back where it should be.