How To Properly Fix Your Credit
By Lee Vick
In today’s society, credit repair has become a common need as Americans are faced with more debt than ever. Regardless of how much repair your credit needs, the following tips will help you work towards restoring a good credit score.
Before you can begin to fix your credit, you need to pull up your credit report to view all information and credit scores. There are several places online where you can obtain a copy of your credit report, with some offering free reports. If you have not pulled your credit in the last 12 months, you may be eligible for a free report from annualcreditreport.com. Knowing exactly what’s reported on your report can help you prioritize the steps needed to improve your score.
Examine your credit report carefully, paying special attention to any negative items. If you find mistakes in your report, contact the credit bureau for instructions on how to correct the information. There may be some negative information on your report that has been reported inaccurately, which you can have removed. Anything that has been reported incorrectly will reduce your credit score, so getting anything inaccurate removed is a vital step in fixing your credit.
Start Paying On Time
When you start working towards fixing your credit it’s important to know that late payments affect your credit score! Every late payment drops your score and prevents you from securing new lines of credit. From this point on, all payments need to be made on time monthly.
A credit card balance below 30% of your limit is recommended. It will be easier to maintain payments if you stick to the 30 percent rule and shows creditors you can manage credit wisely. When your balance gets close to your credit limit, your credit score drops. If you have credit cards with high balances, pay as much as possible to get these account balances lowered. Once you are able to get the balances down, do not use the cards again until you owe a zero balance.
Negotiate With Collection Agencies
If your bills are long past due and collection agencies are now involved, you need to investigate the possibility of payment plans. Given the opportunity, many collection agencies welcome the chance to work out a plan with you.
If the agency believes you are trying to avoid them by letting your debt accumulate, they will be reluctant to work with you. When contacting an agency, ask if they are willing to accept a settlement. Often these agencies will settle for a lower amount than the actual debt. You also need to make sure they are willing to update your credit report as paid when payment is made.
Tip: Learn all the laws regarding collections so that you are aware of your rights. Collection agents cannot threaten or harass you. Do not allow your self to get bullied. Educate yourself about your rights and the laws in your state, and use that information to your benefit.
Negotiate With Current Creditors Find out which creditors are willing to negotiate a payment plan or let you pay a couple weeks late. When you know which creditors won’t accept delayed payments or installment plans, you can move forward and focus on those particular bills first. It is important to know how high the rates and penalties are. By focusing on paying off your high-interest accounts, you can save a great deal of money.
By following the tips listed in this article, you’ll be able to repair your credit easily and get your finances back on track.
If you’re faced with bad credit and need a loan, visit http://www.easy-bad-credit-loans.com where you can get approved for a bad credit loan. Easy Bad Credit Loans is a credit and loan resource guide designed to help get loans for people with bad credit.
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