Would you like to repair your bad credit?
The good news is that there are a lot of steps you can do to start repairing your bad credit. In some cases, getting help from a credit repair company may be necessary but even then, knowing the right steps to do will still give you an advantage.
Consider the following bad credit repair strategies:
Check your personal credit report. Order your report from the three major credit bureaus – Experian, Equifax and Trans Union. This way you will be able to check the status of all your accounts and make sure that there are no errors which could be pulling down your score.
Fix errors in your report.
If you discover errors in your file, it is your right to dispute these items and demand for correction. The Fair Credit Reporting Act clearly states that the credit bureaus should immediately respond to credit disputes made by consumers by conducting an investigation on the matter. If you found errors in several accounts, send a letter of dispute for each account.
Upon receiving your letter, the bureau will start the investigation which can last for up to 30 days. If your dispute is valid, the errors will be removed from your report which can significantly boost your credit score. The bureau will also send you an updated copy of your credit report for free and will notify the two other bureaus about the changes made to your credit history.
Pay your bills on time.
Timely payment is crucial in repairing bad credit. Keep in mind that payment history makes up 30% of your total credit score. Thus, even occasional late payments can negatively affect your score especially if you have a record of delinquent payments in the past.
Pay past due debts.
If you owe those debts, then it is your responsibility to pay them. If you’re having a hard time catching up with your payments, speak with the creditor involved and try to arrange for new repayment terms that suit your current financial situation. If you can’t pay all your debts at once, check which debts can be paid off first. This way, you can lessen the burden of repayment one step at a time.
Be careful with bad credit loans.
If you decide to take out a bad credit loan to pay your debts, keep in mind that subprime loans carry higher interest rates so there is a greater risk if you fail to keep up your repayment. Do your research first and look for a bad credit loan lender that offers a reasonable deal. Remember that even though your credit score needs improvement, you still deserve to be treated fairly and with dignity.
Be patient and keep track of your progress.
Repairing bad credit does take time. More importantly, you will need hard work and determination to pay your debts and recover from bad credit. Nevertheless, you should never lose hope and keep track of your improvements by regularly checking your accounts and your credit report.