Having bad credit is an extremely annoying issue to deal with. A bad credit score will make it hard for you to get a loan or apply for housing, among other things. But, you can fix your credit in a few simple steps and protect it for the future.
Getting a traditional home loan can be difficult, if not impossible, with imperfect credit. If your income is a factor you may qualify for a FHA loan, which has lower standards and makes the federal government your lender in a sense. You may even qualify for an FHA loan if you don't have enough money for a down payment or the closing costs.
The first step to repairing your ailing credit is to create a manageable, feasible financial plan. You can't just make up a plan and not change how you spend your money. Stick to the essentials, and avoid frivolous purchases at all costs. You should only make a purchase if it is necessary and it fits in your budget.
You can get a house mortgaged at the snap of a finger if you have a high credit score. Keeping up with all of your mortgage payments will help pull your credit score even higher. Owning your own home gives you a significant asset to use in securing your finances, and your credit score will reflect that asset. This will be beneficial when you apply for loans.
Before you hire a credit counselor, make sure that you have done your research. While some counselors are legitimate, offering genuinely helpful services, others have ulterior motives. Others are just plain fraudulent. If you're smart, you'll make sure the credit counselor is not a phony first.
Before you agree to any sort of repayment plan to settle your debts, consider how this will affect your credit score. Some agreements won't hurt you as much as others. This is why you should research all of the available ones for you before signing an agreement. Remember creditors want their money. They really don't care about your credit scores. That is up to you to protect.
Check over your credit bill each month to make sure there are no errors. If you notice unwarranted fees or surcharges, contact the credit card company to avoid being reported for failure to pay.
Any time you establish any payment plan with any creditor, make sure you get it in writing. This provides you with documentation that an agreement is in place in case the company changes hands or the creditor tries to change the terms of the agreement. You also want it in writing if it gets paid off so you can go ahead and send it to credit reporting agencies.
This will make sure that you maintain a good credit status. Late payments to credit cards are reported to the major credit agencies and can hurt your chances for securing a new loan.
Go through all the statements you receive. Go through line by line for accuracy, and to prevent getting charged for an item or service you did not actually get. It is solely your responsibility to be sure that everything is correct.
For a better credit rating, lower the balances on your revolving accounts. You can up your credit score by just keeping your balances lower. The FICO system notates when a balance on a card is at 20,40,60,80, and 100 percent of the total available credit.
Credit Score Improvement
Make sure a credit score improvement agency is legitimate before choosing to work with them. The credit score improvement industry does have its fair share of agencies that do not live up to their promises. A fair number of people have been scammed by these unethical credit improvement companies. Use online reviews and other resources to find an honest agency that can help you.
A few easy steps, like the ones here, can help you repair your problems with credit and help you to maintain a healthy credit score. Having a good credit score is crucial to getting the best interest rates possible and is definitely worth the effort.