Your credit may have greatly suffered when you spent more money than you could actually afford or had to make ends meet in this poor economy. Fortunately, you can take some actions to get your credit score climbing in the right direction.
For those with imperfect credit, it can be hard to secure financing for a home. If you are in this situation you should look into FHA loans before speaking with a bank. FHA loans even apply for someone who doesn’t have closing costs or the funds that are needed for down payment.
If you want to fix your credit, you must first conjure a workable plan that you can stick to. You can’t just make up a plan and not change how you spend your money. Only buy what you absolutely need. If you are buying something because you want it, and don’t need it, put it back on the shelf.
If you have a card that carries a balance of over 50% of the limit, you should pay it down to below 50%. 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.
Interest Rates
You can keep your interest rates lower by working to keep your credit score as high as possible. Lower interest rates make it much easier and quicker to pay off balances. Try to get the best offer and credit rates so you can increase your credit score.
The first step to repairing your credit is paying what you owe. Not only must bills be paid, but they must also be paid in full and in a timely manner. Your FICO score will begin to increase immediately after you pay the bills that are past due.
Stay in touch with credit card companies if you wish to repair your score. You should contact the company and request a lower interest rate or a due date change if necessary. You can accomplish this by simply calling and asking them to change payment terms, like your interest rate or your billing date.
Do not do things which could cause you to go to jail. There are plenty of credit scams that purport to erase your existing credit file and create a new one. Do not attempt this because it’s illegal; you will not be able to avoid getting caught. Not only can legal fees add up, but you could end up in jail.
Give your credit card company a call and ask them to lower your credit limit. This will prevent you from spending too much that you do not have. It will also show the credit companies how responsible you are, and if you do need to get more credit in the future, you will have a much easier time.
Don’t sign a debt settlement contract until you know what impact it is going to have on your credit score. There are ways to go about this that will have less of an impact and should be learned about before you make any kind of deal with a creditor. Remember creditors want their money. They really don’t care about your credit scores. That is up to you to protect.
Take the necessary steps to fix any mistakes that you see on your credit reports by filing an official dispute. You should compose a letter to the agencies that have made the errors, and provide proof that you are correct. Send your dispute package with a return receipt request so that you have proof that it was received by the agency.
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. By doing this, you will show your creditors that you are trustworthy with your credit.
Paying your credit cards on time keeps you in good standing on your credit report. Each time you make your payment late it will go against you.
Be careful of paying for a service or a lawyer that advertises quick or instant credit restoration, many of them are dishonest. A lot of people are having difficulty with their credit, and there are lawyers that try to exploit these people with illegal and ineffective credit repair services. Before you give a lawyer any money or any personal information, make sure to do a thorough check on them and their practice to make sure they are legitimate.
If you are having trouble making monthly payments, contact your creditors to see if you can work out a payment option. 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. This can help you get some breathing room. It can also help you pay the bills where you aren’t able to negotiate a different payment plan.
Credit Score
Repairing a poor credit score can seem like a daunting task, but improving your score is possible with guidance and knowledge. Apply the advice from this article to start your march toward better credit score days.
