A poor credit score can put you in a bad position. If you’ve recently gone through some hard times, a bad credit score is just an ugly reminder of that experience. Fortunately, there are some things you can take action on right now to raise your credit score, so read on and get ready to regain control of your credit.
When your credit is so bad that you can’t get a ‘regular’ credit card, a secured one will help you to repair your credit. You are more likely to be approved for this type of card because, once funded, the banks feels secure that you will pay them back. If you open a credit card account, keep charges fairly low, and pay it on time, this will go towards improving your credit score.
Any credit cards that have balances over 50% of your limit should be paid off until they are less than 50% of your limit. Any balances that are over half your limit drag your credit rating down. So be sure to pay your credit card down or, if you can not, try to use another credit card.
An important tip to consider when working to repair your credit is to work closely with your credit card companies. This prevents you from sinking further into debt or further damaging your credit score. One way to tackle this problem is to call them and ask if you can have the due date or monthly charge amount changed.
Before you agree to enter a debt settlement, learn about what happens to your credit as a result of it. Certain methods of settling your debts have less detrimental effects on your credit history. Many collectors just want to get paid and don’t care about credit consequences.
You should examine any negative entries on your credit report thoroughly if you want to fix your credit problems. 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.
Joining a credit union is beneficial if you want to make your credit score better but cannot get new credit. Due to their focus on community finances rather than national ones, credit unions may provide better interest rates and more credit services than typical banks.
As part of your credit repair process, it is a good idea to terminate all of your credit cards except one. You will want to either transfer your balances onto the one remaining card or set up payment arrangements, but close the account to new charges. This allows you to pay off one credit card bill rather than many smaller ones.
Do not carry high balances on any of your credit accounts. Your credit score can go up if you just bring your balances down. FICO will base your score on what percent of your available balance is in use, so keep that in mind.
If you need to rebuild your credit, you need to start establishing a history of responsible borrowing. Prepaid credit cards offer a risk and worry free opportunity to slowly increase your credit score. This will help you prove to lenders that you can be responsible, and are credit worthy
It is illegal for debt collectors or companies to threaten you. If this happens, be sure to document it. You need to know what the laws are that protect your rights as a consumer.
Seek advice from a trustworthy credit counseling service if you are having difficulty managing your debt. These services will help you communicate with creditors to make a simplified payment arrangement that will help you in the long-term. A credit counselor can give you the best advice on how to be in control of your finances, and pay off your debts.
Although it’s easy to feel like you can never recover from bad credit, it is possible to do so. Here are some helpful hints for turning your credit around.