Whether you have bad credit or no credit. A low credit score will make it difficult for you to obtain financing. Frequent late payments and negative remarks can badly affect your personal credit score. The good news is that it is never too late to begin repairing bad credit. No one can repair bad credit overnight but you can do some steps to improve your score one step at a time.
Here are the steps towards repairing bad credit:
Check your credit report.
Order a personal copy of your report from each of the three major credit reporting agencies. Have you received your free report for this year? Consumers are entitled to receive one free report annually from each of three bureaus. Simply visit www.annualcreditreport.com or call 1-877-322-8228. You can also mail your request to: Annual Credit Report Request Service, P.O. Box 105281 Atlanta, GA 30348-5281.
Make sure that your report does not contain any errors. If you find any, send a dispute letter to the bureau that issued your report. After 30 days, you should receive a letter from the bureau informing you about the result of the investigation along with an updated copy of your report for free.
Pay down your debts.
If the charges in your credit report are accurate, then the only way you can improve your credit rating is to pay your debts. There is no way you can instantly delete negative items in your report if they are accurate.
If you can’t pay all your creditors at once, choose debts with the highest interest rates and make them your priority. This is important to stop your debts from continuously accumulating. Have you tried to negotiate with your creditor? IF you haven’t yet, then it’s definitely worth the effort to try. By speaking your creditor, you might be able to reduce your present interest rate, lower your monthly payments, or have extra charges waived so you can have an easier time catching up with repayment.
Minimize your credit limit usage.
Credit utilization is makes up 30% in the FICO scoring system. A smart credit repair strategy is to minimize the use of your credit limit on all your accounts. If you have bad credit, you might want to keep your charges below 20% of your available credit line to improve your score more quickly.
Get professional credit repair help.
If the problem is too overwhelming for you to solve on your own, you should get help from the experts. Look for a credit repair company or credit counseling agency that is legitimate and reputable, with a good track record of service. Be sure to do some research first before signing up for help.