You may be able to prevent forming debt simply by knowing exactly how much you owe and to whom. So now it is time to exercise crisis management and to repair your credit score. Follow this easy advice to get your credit back on track.
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 are great for the individuals that do not have the financial capability to make down payments.
Installment Account
Opening an installment account can give quite a boost to your credit score. With an installment account there is a monthly minimum you need to keep, so only open an affordable account. You might see a big improvement in your credit score, if you can handle an installment account responsibly.
If you want to avoid giving too much to your creditor, simply refuse to pay towards unfairly huge interest rates. An interest rate that is shockingly high can possibly be ruled as illegal in certain cases. Remember that you agreed to pay that interest when you signed the contract. It is possible that you can sue a creditor and claim that the interest rate charged is unreasonably high.
Any company or credit counselor that claims they can erase all negative reports from your credit history should be viewed with some skepticism. These things are, generally, on your record for seven years. It is possible to have erroneous information removed from your report, however.
Credit Score
Before you agree to any sort of repayment plan to settle your debts, consider how this will affect your credit score. Do some heavy researching before starting an agreement with any creditor; there are other options that may not damage your credit score as heavily. The creditor is only interested in receiving the money due, and is not concerned with your credit score.
If you’re trying to fix your credit, be sure to check all your negative reports carefully. Any mistakes, such as in the amount owed or the date the agreement was entered, could result in the removal of the entire negative trade line on your credit report.
Officially dispute any errors you find on your credit reports. Contact the credit agency in writing, with documentation to support the errors that you are disputing. Mail your dispute documents to the agency using certified mail and a return receipt so that you can prove the agency received them.
If you are currently spending more than you earn, you need to quit that immediately. You may have to overhaul your entire mindset when it comes to money. The rise of consumer credit in the past few years has made it far too easy to buy items without being able to pay, and the bills are coming due. Take a hard honest look at your budget, and figure out what you can honestly afford to spend.
Credit Card
Shut off all but one credit card if you want to fix your credit. You can transfer all of your balances to one credit card, ensuring you choose the one with the lowest interest rate. In this manner, you can take care of all your credit card debt by paying down a single balance.
If you work out a payment plan with a creditor, you should make sure to get the plan 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. If you have finished paying it off, you should request a confirmation so you can send it to the credit reporting agencies.
Do not file for bankruptcy if you do not have to. It can adversely affect your credit for up to 10 years. Bankruptcy not only zeros out your debt, it also zeros out your credit score. Once bankruptcy has been filed, it could permanently halt your chances of ever obtaining credit again in the future.
When you pay your bills on time, you are keeping your credit score high. Credit card companies are one of the few businesses that report on a regular basis. Paying late can severely hurt your credit score.
One of the biggest stressors can be bad dealings with debt collection agencies. You can get a collection agency to cease and desist from harassing you but this does not discharge the debt. Remember, even when the debt collectors stop annoying you by phone, your obligation to pay what you owe is not alleviated.
As this article has spelled out, fixing your credit is not rocket science, and it may be easier to do than you think. Using this easily-understood information can help you reach your goal.
