You have most likely done damage to your credit, whether you got a card from friends, went on too many shopping trips or were hit by economic pressures. The good news is that there are some things that you can do to repair it.
An imperfect credit rating can make financing a home even more difficult than normal. In this situation, it is a good idea to try to obtain an FHA loan, because these loans are guaranteed by the federal government. You might be able to get an FHA loan even if you cannot afford closing costs or down payments.
For a credit score boost, an installment account will help. You have to keep a monthly minimum on an installment account, so make sure you open an account that you can afford. If you use one of these types of accounts, your score will quickly improve.
The first step to repairing your credit is paying what you owe. Pay these bills on time, and make sure you pay the full amounts owed. When you pay off past due lines of credit your credit score will go up.
Before consulting a counselor for credit score improvement, do your research. Many counselors are on the up-and-up and are truly helpful. Others just want to take money from you. Some are just people trying to scam you. Before you conduct any business with a credit counselor, check into their legitimacy.
Contact your creditors and see if you can get them to lower your overall credit limit. By doing this it will stabilize you in your financial boundaries instead of letting you extend beyond what you really should.
When you are attempting to improve your credit score, carefully comb over your credit reports for negative information. The item may be essentially correct, but there may be an error someplace. If the date or amount, or some other thing is incorrect it may be possible to get the entire item removed.
Officially dispute any errors you find on your credit reports. Draft a dispute letter that will go to each credit rating agency that shows an error, and prepare any supporting documents. Send any correspondence by recorded mail to ensure proof of receipt by the agency.
To show that you are serious about improving your credit, start systematically lowering all of your account balances. No matter what the balances are on your credit cards, pay down the highest interest rate cards first. By doing this, you will show your creditors that you are trustworthy with your credit.
Paying your credit cards on time keeps you in good standing on your credit report. Credit card companies are one of the few businesses that report on a regular basis. Paying late can severely hurt your credit score.
Fixing your damaged credit may seem like an overwhelming task in the beginning, but with a bit of work and a bit of guidance, you can turn things around and get your credit back on track. Put the information you just learned into practice and start repairing your credit today.