Whether you got your credit cards on your college campus, got carried away on one too many shopping sprees or got hit hard by the recent economic downturn, you probably did some damage to your credit. The following tips will help you take steps to begin to repair it.
Secured Credit Cards – The best way to obtain and fix your credit
If you want to repair your credit but do not qualify for a regular credit card, sign up for a secured card. The benefits of a secured credit card are many. But one of the best reasons for obtaining one is that they look like a regular unsecured credit card on your credit report. Many banks look at “comparable credit” when they are thinking of approving your loan. Many unsecured cards for bad credit only start off giving small credit lines. Usually around $200 – $500. With a secured credit card, your credit limit equals the amount that you put down as security. I’ve had clients give their credit reports a good boost by adding a $2000 secured credit card to their credit reports. If you show a good history of payments with this card, the card will usually become unsecured within 12 – 24 months meaning you get your security deposit back AND you still have a line of credit of $2000 but now its unsecured. Secured credit cards will go a long way in repairing your credit.
The Effects Of Installment Loans On Your Credit Score
Opening up an installment account can give quite a boost to your credit score . You can quickly improve
your credit score by properly managing these accounts.
If you have access to a credit union, this can be the best place to find a lender willing to give you an personal loan or credit card even if you have bad credit. Credit Unions tend to take the extra step to try to accommodate their members.
Simple Tips To Help You Improve and Maintain Your Credit Score
- Do not live beyond your means any longer.You will have to change your way of thinking in order to do this correctly. In the not too distant past, people used good credit ratings to buy the items that they normally couldn’t afford, but now those risky financial choices are catching up with them. Be honest with yourself about what you can afford.
- Even though the particular credit item may not accurate, any small mistake in the item, such as an inaccurate date or amount, could make the entire entry invalid and eligible for removal.
- If you have a card that carries a balance of over 50% of the limit, then pay them down until they are below 50% utilization.
- If you have been making all of your payments on time for more than a year, call your creditor and ask them if they can reduce your interest rate. You may even offer to let them take the payment themselves each month thru automatic draft. Lower interest rates will make your payments smaller and easier to repay. Thus helping you to pay your debt off much quicker.
- Check your credit card statements each month and make sure there are no errors. If there are late fees, contact the credit card company to avoid being reported for failure to pay.
Pay off any balances as soon as you can to start the credit improvement process. Pay off accounts with the highest interest and largest balances first.This builds the positive credit history that you atre trying to pay your bills and be responsible.
Lowering the balances you carry on any currently revolving accounts will increase your credit score. Your credit score can go up if you keep your balances down.
- Make sure you check out any credit counseling agency or counselor before you hire them. Many counselors are honest and helpful,but some are outright scams.
TIP! If your credit is poor, take the first step to repairing it by taking steps to pay down the majority of your cards. Leaving yourself just one to use. You can make arrangements to pay the balances, or transfer the balances to your single remaining credit card.
- Try to use your cards only for purchases you can afford to pay off. Use cash for purchases instead while you need to buy something. If the purchase you’re buying is more than you can currently afford you can use a credit card, be sure to pay it all in full.
Repairing a poor credit score can seem like a daunting task, but improving your score is possible with guidance and knowledge. Apply the advice from this article to start your march toward better credit score days.