You may have been able to prevent debts if you had realized who you currently owe money to and just how much you owe. It’s now time to buckle down and fix your credit. To repair your credit, follow the following advice.
An imperfect credit rating can make financing a home even more difficult than normal. You should consider getting a FHA loan they are backed by the government. You may even qualify for an FHA loan if you don’t have enough money for a down payment or the closing costs.
Credit Cards
If you have credit cards with a utilization level over 50%, then pay them down until they are below 50% utilization. Once your balance reaches 50%, your rating starts to really dip. At that point, it is ideal to pay off your cards altogether, but if not, try to spread out the debt.
You may be able to get a secured credit card even if your poor credit has prevented you from getting other credit cards. These types of credit cards often require a good faith deposit to open a new account. Limited spending and regular payments can turn a new credit account into a valuable credit score repair tool.
Maintaining a respectable credit score will enable you to obtain lower interest rates. Monthly payments are easier this way, and you can pay off your unpaid debt. Quickly paying off your debts is a good way to improve your credit score. This will give you access to more competitive rates in the future.
Paying off any debts you have that have high interest rates can help you to avoid paying too much. Some companies that charge high interest rates are running the risk of having those rates challenged by consumers. However, you agreed to pay the interests off when you signed the contract. You may wish to make a legal claim that the interest rate charged exceeded your state’s statutory limits.
Do not do anything that will make you end up in jail. There are many different places that claim they can help you get a new credit profile. This tactic is not legal, and you face serious repercussions if you are caught. Think of the legal costs and the possibility of doing hard time.
When looking to improve your credit, avoid companies claiming that they can remove negative information if the debt is true. Regardless of their claims, these debts will stay on your report for seven years at a minimum. You can erase information that is incorrect from your credit record.
Before consulting a counselor for credit score repair, do your research. Many may have ulterior motives, so make sure you are not being duped. You’ll find that other ones are just scams. Consumers should always check to see if a credit counselor is not a scam before deciding to use them.
Ask credit companies to lower all of your card limits. This helps you from overspending and shows that you want to borrow responsibly and it will help you get credit easier in the future.
Make sure you review all of the negative marks against you on your credit report. There may very likely be errors or mistakes that can be removed.
Check over your credit bill each month to make sure there are no errors. If there are mistakes, call the company. If the errors are not fixed, they could get reported to the major credit rating agencies.
If you are able to negotiate a repayment plan with your creditor, be sure to get it in writing. This way you have documentation of the agreement in case the creditor decides to change their mind or ownership of the company changes. When you pay it off, send a written copy of proof of payment to all three credit reporting agencies.
Common Sense
If getting a new line of credit is vital to your credit repair efforts, look into joining a credit union. Credit unions sometimes have better rates and more options for your credit rather than a large bank. You can base this on how well the economy is in your area instead of the national situation.
In truth, as you will see, credit repair is mostly about common sense. If you follow some sound advice and use common sense, you can be on your way back to good credit.