Having bad credit is an extremely annoying issue to deal with. Instead of getting that house or that job, you are left sitting with a refusal and a copy of your credit report. There are a few things you can do to improve and protect your credit.
Having poor credit makes financing a home a nightmare. Federally guaranteed loans (FHA loans) may be an option. FHA loans can even work when someone lacks the funds for down payment or closing costs.
If you have a poor credit history and can’t qualify for a credit card, get a secured card. These accounts are much easier to get as you will have to fund the new account ahead of time with a deposit to cover any purchases. A new credit card, used responsibly, will help repair your credit rating.
Excessive interest rates can be contested. However, it is best not to sign contracts containing them in the first place. Creditors are skirting a fine line of law when they try to charge you exorbitant interest rates. You did however sign a contract that agrees you will pay off all interests as well as the debt. If you decide to sue your creditors, you should be able to have the interest rates recognized as too high.
When looking to improve your credit, avoid companies claiming that they can remove negative information if the debt is true. Unfortunately, negative marks will stay on your record for seven years. Know, however, that it is possible to delete information that is actually wrong.
Stay in touch with credit card companies if you wish to repair your score. Talking to them will help keep you from drowning further in debt and making your credit worse. Do not be afraid to call your credit card company and ask if you can make changes to your due date or your minimum payment amounts.
Make sure you check out any credit counseling agency you consider using. While there are lots of counselors with your best interest at heart, there are others who just want your money. Some are not legitimate. You should always find out if a credit counselor is the real thing.
Don’t do anything illegal. As we speak, people are trying to take advantage of illegal practices to have people create credit files that can get them into trouble. This is illegal and you’ll get caught. Penalties can include large fines and possibly even incarceration.
Find out how your debt settlement contract will make your credit score look. Some methods of credit settlement can be a blow to your credit score, so it’s important to check into your options and find one that won’t hurt you in the long term. Debt settlers are more interested in their money than your credit rating.
If you find a mistake on your credit report, be sure to dispute it! A dispute letter should be sent to any of the agencies that are reporting the error. Be sure to include supporting documents. When you mail your dispute package, be sure to make arrangements for confirmation of receipt. In this way, you will have documentation that your information has been received.
Live within your means. This will require a change in your thinking. For a while, the easy availability of credit encouraged people to buy more than they could afford. We now must pay for that. Keep track of your spending habits and income, then realistically create a budget that will get you out of your debt dilemma.
Credit Card Balances
Begin the process of credit score improvement by trying to pay down your credit card balances as fast as you can. First, pay down your credit card balances, starting with the highest interest. This can prove to creditors that you are serious about paying down your debt.
Read every credit cart statement you receive in full. Errors are not as rare as you might think. Take a second look to make sure that you are being charged only for what you actually purchased. The responsibility lies with you to verify that each charge is accurate.
Credit Score Repair
There are many credit repair agencies advertised; you must check with places like the Better Business Bureau to make sure that you deal with a reputable one. You have to watch out for credit score repair agencies that promise more than they can deliver or are simply fraudulent. A fair number of people have been scammed by these unethical credit repair companies. If you do some online research, you can find out what people really think about the various credit score repair agencies. This will help tremendously in choosing a safe and effective company.
Unfortunately, no financier is going to be interested in the statement you provide when they are examining your credit history. If anything, it will just hurt you as it will draw attention to the negative event.
One of the most nerve-racking aspects of being in debt, and having bad credit, is dealing with collection agencies. Debtors can stop harassment by collection agencies with cease and desist notices, but know that this is all they do. The consumer still has to pay disputed debts even though these letters stop agencies from calling.
Do not assume that a lawyer is being honest when he or she claims that they can fix your credit instantly. Because so many people are experiencing credit problems due to the economy, shady lawyers that advertise useless, possibly illegal credit score improvement services have appeared. Check the reviews and reputation of any lawyer or credit score improvement firm thoroughly before you contact them and certainly before you give them any money.
If you are experiencing difficulties paying your monthly expenses, you should get in touch with your creditors right away to develop other payment plans. Often, a creditor will work with you to devise a repayment plan that is not reported to credit bureaus if you are proactive about contacting them. By doing this, you will now be able to focus on debt accounts that don’t give you the freedom of establishing a payment plan.
The tips you just read are just a few simple strategies you can employ to rebuild your credit and keep it squeaky clean going forward. Because a good credit rating is important in so many financial transactions, the time you spend learning about credit score repair is well-spent.