Bad credit can make it difficult or almost impossible for you to get approved for any kind of loan or a mortgage, and there’s even a possibility your credit could interfere with your ability to get a job. But fortunately, there are a number of things that you can do to fix your credit, so here are five tips for repairing your damaged credit:
Get A Copy of Your Credit Report
Before you attempt to repair your credit, you should get a copy of your credit report from Transunion, Equifax and Experian, they all allow you to get one free report each year. You must learn to read and dissect your report before taking any action, as some people have bad credit because they have wrong information on their credit report, so you want to make sure that you read your report thoroughly. If you find any errors on your report, then you should contact the credit reporting agency as soon as possible.
Pay Off Your Collections
Regardless of how long a discrepancy has been on your report, if you have an account that has been sent to collections, then you will need to pay it off as quickly as possible. Your credit score might not improve immediately, but you need to get these taken care of, ASAP! You can go through the collection agency, or better yet, go directly to the company that you have the balance with. You should know that paying off these collections will show activity on your credit, but the positive is that it shows that you’re paying these collections off. After all, this is your debt that you accumulated and you are responsible for in the end, so take a deep breath and swallow the medicine.
Lower Your Credit Card Balance
A portion of your credit score is determined by the amount of debt that you have, therefore, you can boost your credit score by paying off some of the balance that you have on your frequent flyer miles credit card, or other credit cards you have a balance on. You should try to pay the card off each month, but if you are not able to do that, then you should pay as much as you can, and keep in contact with your provider, letting them know about your situation. Slow and steady wins the race.
Pay Your Bills by the Due Date
Because 35 percent of your credit score is determined by your payment history, you will need to make sure that every bill is paid by its due date, because all it takes is a couple of late payments to ruin your credit. It also goes both ways, as you can improve your credit by paying your bills on time every month, and even better if you can afford paying a little more than the minimum. Although it’s okay if you cannot afford to pay the full balance every month, just as long as you are making the minimum payment, your provider will not send a negative report to the credit bureaus.
Consider Getting A Secured Credit Card
A credit card is something that can make or break your credit, and one of the simplest things that you can do to rebuild your credit is to take out a secured credit. You will need to make a deposit before you can use the card, and the limit on the credit card is often equal to the amount of money that you deposit on the card, therefore, the credit union or bank is at a low risk, and they’ll be more likely to work with you. Every time you make a payment on your secured credit card, the credit card company will send a positive report to the credit bureaus, so over time, this will cause your credit score to increase.
Bad credit does not have to make your life difficult, if you have current errors on your credit report, don’t panic, because with time and diligence you will be able to improve your credit. You’ll thank yourself in the long run, you’ll thank yourself for being responsible now, just the same way you wanted to reprimand yourself for letting things get out of control in the first place.
So work with the companies that have discrepancies with you, talk to the right people, and get this sorted out today.
See Also:
- 5 Good Reasons To Get Title Insurance
- Financial Jargon – Investment Terminology for Beginners
- How To Manage Your Mortgage After Bankruptcy
- How to Calculate Your Credit Score
- Poor Credit Rating?
Recommended by Amazon:
- Credit Repair
- Hidden Credit Repair Secrets: 2nd Edition
- Credit Warfare: Advanced Credit Repair and Debt Collection Strategies for the Novice and Expert User, Vol. 1
- The Total Money Makeover: A Proven Plan for Financial Fitness
- Dave Ramsey’s Complete Guide to Money: The Handbook of Financial Peace University
Author Bio
Melisa Cammack has been freelance writing for a number of years, is a mother of three children, and is hoping to be a published book author by the end of 2013.
Image courtesy of Stockimages / FreeDigitalPhotos.net
