You can feel like the bad guy if you have bad credit. Your bad credit score may remind you of a bad point in your life. However, your luck can change when you realize that there are simple things that you can do immediately to raise your credit.
Financing a new home can be a challenge, especially if you have a history of bad credit. An FHA loan can be helpful in such a case since the federal government backs these loans. FHA loans can even work when someone lacks the funds for down payment or closing costs.
The first step to repairing your ailing credit is to create a manageable, feasible financial plan. Make a commitment to making better financial decisions. Only the necessities can be purchased from here on in. Ask yourself how necessary each purchase is, and how affordable it is too. If you can’t answer “yes” to each of the questions above, you need to reconsider the purchase.
Any credit cards that have balances over 50% of your limit should be paid off until they are less than 50% of your limit. You should keep your balances under fifty percent; anything over this and you can lower your credit rating, so spread out the money you own and pay down your credit cards.
If you are looking to repair your credit, then you should not believe a company if they promise they can remove negative information from the report. Specifically if this information is correct. These bad marks stay on your record for seven years or more. If the information is an error, the credit report can be corrected.
Repairing your credit is actually pretty simple. The first step is to focus on paying your late bills. Paying your bills on time and for the full amount is important. Your credit score starts to improve immediately upon paying off some of your past due bills.
Don’t attempt to fix your credit in a way that will result in you breaking any laws. Don’t buy into scams that suggest you create new credit files. Doing this is illegal, and you will be caught. The criminal charges that you face will be very expensive, and you may also have to serve prison time if found guilty.
Call and request lower limits on your cards from the credit card companies. Doing this keeps you from overtaxing yourself. It also shows the lending company that you are responsible.
If you find any errors on your credit report, you should dispute them. Compose a letter of dispute to every agency that reported errors, and include as much documentation as you can. Send your dispute package with a return receipt request so that you have proof that it was received by the agency.
Shut off all but one credit card if you want to fix your credit. Transfer your balances to this one card, with the lowest interest, if this is possible. This allows you to pay off one credit card bill rather than many smaller ones.
If you wheel and deal and get a new payment plan, be certain to have it on paper. This will provide proof of your agreement in case any problems ever arise. Once it is paid off, you should get that in writing to send to the credit reporting agencies.
Begin the process of credit 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. Doing so shows your creditors that you are taking your debt problem seriously.
Carrying a low credit score can make you feel negative toward many aspects of your life. If you follow these tips, you will be well on your way to improving your credit.