If you had kept a record of who you owed money to then perhaps your debt could have been avoided. Now it is time to figure out how to resolve the problems and create a better future. The following information is quick, simple and can help repair your credit if followed correctly.
Keep your credit card balances below 50 percent of your credit limit. Carrying a balance of more than half your credit limit negatively impacts your credit score. Either pay this balance down or spread it out over multiple cards.
Getting an installment account can help you earn money and provide a boost to your credit. You need to review the terms of an installment account carefully, because you’ll be required to maintain a certain monthly minimum. If you are able to keep up with one of the accounts, you should see your credit score improving quickly.
If your creditors try to jack up your interest rates, do not pay them. It is important to know the terms of your original agreement for the debt you incurred. Usually if you agreed to the terms the terms will be upheld as legal. If you believe the charges are excessive and your debtor will not negotiate down the interest and other additional charges, state laws might provide you with additional avenues to pursue a reduction in these charges. Federal law provides that when you are billed by a collection company the fees and interest cannot exceed the amount of the original debt. Remember you agreed to pay any interest that accrued over the life of the account. If you plan on suing your creditors, you may be capable of having the interest rates viewed as being too high.
If credit score improvement is something you are investigating and a company has told you they can strike true, but negative, information off of your credit report, they are lying. Bad marks on your report will not go away for seven years. It is true, however, that you can remove inaccurate information from your report, but you do not need the assistance of a consultant to do so.
Do not do anything that will make you end up in jail. You should steer clear of internet programs that show you how to clear your credit. Needless to say, this is against the law and you are likely to get caught. In addition to the possibility of facing jail time, you could be fined, your attorney bills may be substantial, and your reputation could be ruined.
Joining a credit union is a great way to build your credit if you are having a difficult time doing so elsewhere. Credit unions focus more on the local situation instead of the national one, and may provide more options or rates that are more favorable than those of a larger bank.
Dispute any errors that are on your credit report so they are removed. Gather your support documents, make a list of the errors, and compose a letter to pertinent agencies. Use a return receipt when you mail your package so that you can prove that the agency received it.
If your credit is poor, take the first step to repairing it by closing out the majority of your cards, leaving yourself just one to use. Call your credit card company and try to work out a repayment plan, or transfer the balances of multiple cards to one lower interest card. It will be easier for you to make payments on a single credit card account, as opposed to several.
Any time you establish any payment plan with any creditor, make sure you get it in writing. This is for your protection. It allows you to have valid documentation of the terms in the event that a creditor reneges on its offer or changes owners. Once the debt is fully paid, you need to get a statement verifying this from the creditor and send it to each of the major credit bureaus.
If at all possible, avoid filing bankruptcy. Doing so will reflect upon your credit score and report for 10 years. You may think that bankruptcy is your only option to rid yourself from debt, however look at your long term financial goals before deciding to file for it. You may not qualify for auto financing or a credit card after filing for bankruptcy protection.
Repairing your credit rating and cutting down your debt involves a lot more common sense than anything else. You can find those waters by sailing with these tips.