Many people who have poor credit believe fixing it is nearly impossible or will take years. This is not necessarily true. Sometimes the smallest issue on your credit report can be easily fixed and may be significant enough to change your score.
If you are ready to begin the journey of credit repair, there are a few tips that will help you create a solid foundation to excel forward. To get started you will need to know your current credit status. You can do this at annualcreditreport.com. This website gives you a free print out of your credit report. Annual Credit Report does not include the credit score on the report, unless you pay for it. Credit Karma is a great place to keep track of your score, for free. Although the score from Creditkarma.com isn’t completely accurate, it gives you an idea of where you stand. With these tools, you are on your way to taking control of your financial future!
There are a lot of credit mistakes people make. Often they do not realize these mistakes are affecting their financial future. Anytime you apply for a cellphone, apartment, student loans, a car, credit card, etc., you are allowing a company to place an inquiry on your credit. This can possible lower your score. Do not excessively apply for things, if you can help it. Do your research first. Call the company and find out what their credit criteria is prior to applying. Ask if there is a certain thing they are looking for on your credit report like your score, credit history, and any negative reports such as late or non payments.
Only purchase items you can immediately afford or can pay in full within 30 days. Renting furniture or electronics from places like Rent A Center or Aaron’s can also negatively affect your credit. A word of advice: Saving $250 dollars for a XBOX is a lot cheaper than renting it for $11 dollars a week, for 52 weeks. Save the money first then purchase the item. I know, it’s not the instant satisfaction of having the item now. Just think, once you purchase the item with your saved money, it’s yours! No one can take it away or report on your credit for non-payment.
Once you obtain your credit report, make sure you have a tangible copy. This way you can easily refer to it and write down the things you’ve inquired about or settled. If there are any items with low balances you can afford to pay in full, do that first. If there are items on your report that you cannot afford to immediately pay, but would be able to pay in full within six months or less, call the company listed on your credit report and make payment arrangements. If there are accounts that have amounts close to, or more than your yearly income, ask if you can settle those accounts for less than what you owe. Settling a credit account is not an ideal situation. It will be reported that it was settled, closed and you paid less than the balance due.
Be responsible. If you open a line of credit, you are responsible for paying what you agreed to. If you do not pay it, it can financial haunt you for many years. It’s not worth the trouble. If you ever want to purchase a home, new car or get a loan; companies are looking at the financial paper trail you’ve left. Your credit report is a financial report card, you cannot graduate if you have all F’s. Strive for A’s, it pays!