воскресенье, 6 ноября 2016 г.

5 Tips To Repair A Bad Credit Score

5 Tips To Repair A Bad Credit Score


5 Tips To Repair A Bad Credit Score


What’s your poor credit score costing you? Higher loan rates and insurance premiums are a given if you have bad credit. If have a low credit score, you may not even qualify for certain loans, like a mortgage.


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You may think a good credit score is impossible to get, but these tips will help you get a better score. Your score will not change overnight; it will take months to see a positive change in your score.


You’ll need to look at your credit report to know what you need to work on.


1. Dispute incorrect information


When you look over your credit report, look for anything that may be inaccurate.


Common mistakes:


-A paid or closed not updated to a closed status


-A paid or closed loan still showing a balance owing


Look at each account for:


-Correct outstanding balance


-Payment history is correct (only payments you were truly late are reported as late)


-Account status is accurate (open, closed, paid, etc)


If you find an item that is not correct, dispute it with the credit bureau.


They will open a case and investigate your dispute. Then your credit report will be updated (if it was incorrect) or you will be notified of the result.


2. Decrease your utilization ratio


This refers to the balances you currently owe on your cards/lines of credit relative to the limits of the cards. You should aim for a ratio of 30% or less.


If two people have identical credit, other than one owes $500 on a $5000 limit credit card and the other owes $3000 on the same $5000 limit credit card, the one with the lower balance will have a better credit score.


How to do it:


Make larger payments so you owe less on your credit cards.


Request a credit card limit increase (only if you won’t be tempted to spend more).


3. Have at least three items on your credit


Many lenders like to see a variety of loans on your credit report. Also, a person with payment history for three loans will typically have a higher score than a person with just a single loan on their credit report.


4. Pay your debts on time


Your payment history is an important piece when your credit score is calculated. Just one late payment can cause a big decrease in your score.


Even if you can only pay the very minimum, regular on-time payments will go a long way in improving your credit.


Note: this only refers to debts (credit cards, car loans, etc). Your monthly bills (cell phone, utilities, cable) don’t affect your credit unless they go to collection.


5. Resolve negative items to improve your credit score


You’ll want to payoff any collections or charge-offs on your credit report. Start with the newest ones since they have the biggest affect on your credit score.


If you can’t pay the newest ones, then start with the smallest one. One paid collection is better than no paid collections.


Don’t have the extra cash? Check out these posts that might give you some ideas on saving money:


10 Ways You Are Throwing Money Away


12 Simple Ways To Cut Your Grocery Costs


10 Ways To Save Money In The Bathroom


You could also see if the lender/collection agency is willing to settle. The prospect of getting some money may entice the lender to take less than the full amount. This is especially possible if you have money that you can pay right now.


Note: Only pay collections and charge-offs if you are making your other debt payments on time. The chargeoffs/collections are already negative items. Don’t risk other negative items at the cost of trying to fix others.


Original article and pictures take http://www.centsandorder.com/5-tips-to-repair-a-bad-credit-score/ site

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