Sunday, July 26, 2015

Rebuilding Your Credit in 10 Simple Steps


No one wants to have bad credit. A lot of doors will close on you financially. You might not get qualified for loans and in some cases, employers check credit reports before deciding to hire you. Rebuilding your credit doesn’t have to be complicated and along with a little patience and some planning, you can obtain an excellent credit rating. To make a little improvement on credit scores, we’ve come up with a few guidelines to walk you through and bump up your score to the “good range”.

Here are 10 simple yet effective steps on rebuilding your credit score:

1.    Watch out for those credit card balances and make payments on time. It is best to always double check your statement when your bill arrives to ensure that the charges are correct and accurate. Check out and see if the credit card issue will accept multiple payments throughout the month if you’re able to. Making payments on time may seem the most obvious out there but be aware that late payments are the most negative information that can appear on your credit report. It’s essential that you at least pay the minimum amount in a timely manner, without exceptions.

2.    Keep your credit balances low. Your credit cards, as well as your payment history on those credit card accounts impacts your score. Prove that you are actively reducing the balances while being a responsible card user.

 3.   Leave “good” old debt on your report. Once you have paid off the balances on your debt, don’t go and hurriedly call to close off and have it removed from your credit report. This is considered good debt and it’s good for your credit. The longer the history of good debt you have, the better your credit score is.

 4.   Apply for credit only if it’s needed. It might be tempting to open up a new charge or credit card account when you go shopping for big items and they would offer great financing deals on large purchases with that retailer. Think this thoroughly because each time you apply for a credit, it could cause a small dip on your score that lasts a year because if you make multiple applications for credit, it means that you want to use more credit.

 5.   It’s best to separate accounts after a divorce. The information on each person’s credit report will impact their spouse’s and when the divorce proceedings move forward, make sure that everything is paid off and close all joint accounts or have one name removed from each account. As long as both names appear on the account, both parties are still responsible for its activities.

 6.   Make sure old information is removed and correct inaccurate information on your credit reports.

 7.   If possible, avoid bankruptcy at all cost. This should be considered as the last and final solution if everything did not work out at all. It’s one of the worst things you can do to your credit and it will continue to haunt your credit report up to 10 years even if you would have recovered already.

 8.  Don’t risk it. Missing payments and paying less or charging more than you normally do could sink your credit score.

 9.   Avoid excessive inquiries. Each time you’d apply for any type of loan or a credit card, potential creditors will inquire on credit reporting agencies about your status. Having multiple inquiries in a short amount of time can drastically reduce your credit score.

10.  Negotiate with your creditors. A lot of creditors are willing to understand your situation as it also impacts their business. It never hurts to ask and they could offer you a resolution that’s acceptable and within your financial means.

Don’t obsess. Just be focused on your score when you know that you’ll need credit. As long as you are being financially responsible and diligent in making payments up-to-date and learn from your previous mistakes, you’ll be on your way to financial stability and managing your credit properly. Should you need any further assistance in working on your credit score, you can go to Trust Deed Scotland and let them help you in rebuilding your credit.

source: everybodylovesyourmoney.com