Fixing Your Credit for the Long Haul

Fixing Your Credit

Fixing Your Credit

In times of economic stress it becomes more important than ever to maintain a good credit record. If your credit history is less than it should be then it is time to fix your credit history and get your credit rating back on track.

Why it is important to repair your credit

Your credit score affects just about everything – your ability to get a loan, buy a house, rent an apartment, lease a car, and qualify for a credit card. It can even affect what you pay for your home insurance.

What is a good credit score?

Credit reporting companies consider a score in the 700′s to be a good credit score. If your credit score doesn’t measure up or even come close don’t despair. Even if your credit score is poor there are immediate and long term things you can do to improve your credit rating.

How to fix your credit

If your credit history is less than stellar you probably can’t just pay off all your debts in one fell swoop. If finances are such that even paying a little extra to whittle the debt down then you have two options: lower your expenses or take an extra part time job. Do both if you can. Set a monthly budget and stick to it. Then start making extra payments on your credit card debt, starting with the debt with the highest interest and focus on paying it down. You will be amazed how soon you can start paying your debts off.

If at all possible make at least minimum payments on your debts and make them on time. Every time you are late with a payment or pay less than the required minimum your credit history takes a hit. Each month you pay on time your credit record will improve. Keep your payment records in case there is a need to dispute items on your credit report.

Be proactive

Contact your creditors yourself (you don’t need a debt reduction company to do this for you). Ask for a complete statement of the debt you owe and try and negotiate a lower interest rate. You need to know exactly what it will take in terms of payments for the company to issue a positive payment report.

Check out your credit reports on all three credit bureaus. You are entitled to a free credit report on an annual basis. First off make sure there are no errors on your report. Once you are able to make good on a debt make sure you get a record of payment and send this to each of the credit bureaus: Transunion, Experian, and Equifax.

Lay off the credit cards

If you are carrying significant credit card debt and you have not maxed out your credit – don’t use it. Put your credit cards away and don’t apply for any new cards. If your credit history is not good you will probably be turned down for additional cards and each turn down appears on your credit record. If you wish to use the best credit card for people with bad credit, there are a few options.