Fix Your Credit History With These Tips

| August 9, 2014 | 0 Comments

Bad credit hurts you in nearly all your financial dealings, especially those that involve extending credit to you. Negative credit can be a hindrance both now and in the future. It is possible to fix your credit however. Consider implementing the following tips of this article to help you successfully repair your bad credit.

If your credit is not perfect, getting a mortgage can be tricky. An FHA loan can be helpful in such a case since the federal government backs these loans. FHA loans are ideal for those who cannot afford the high down payment that most banks require.

TIP! If you have a poor credit rating, it can be extremely difficult to obtain a mortgage loan for a home. 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.

Pay down any credit cards with a balance in excess of 50%, preferably getting them down to 30%. If your credit card balances exceed 50% of their limits, it will lower your credit score, so spread your debt over multiple cards, or better, pay down the balances.

Credit Score

Good credit scores allow you to take out loans, buy a house, and make other large purchases. Making mortgage payments in a timely manner helps raise your credit score even more. When you are a home owner you will be financially stable based on what you own. Having a good credit score is a key factor if you ever need to take out a loan.

TIP! If you have credit that is not high enough for you to obtain a new credit line, sign up for a secured card. Anyone can get one, but you must load money onto the card as a type of “collateral”.

One thing to watch out for when trying to fix your credit is scammers who say that they can get any negative information deleted from your credit, regardless of its accuracy. Unfortunately, this negative information stays on your credit record for at least seven years. However, if there is incorrect information, you can have it cleared up easily by yourself.

Due Date

When you are trying to clear up your credit contact your credit companies. You should contact the company and request a lower interest rate or a due date change if necessary. You can do this by speaking with them and asking to change the monthly charges or due date.

TIP! Try to keep a balance of less than 50% of your available credit on all of your cards. Any time you exceed 50% of your credit limit, your credit rating is affected.

Find out how the process will affect your credit rating before you agree to any debt settlement agreements. Some debt settlement methods can hurt your credit even more, and you should be sure of how it will affect you. Some are out there just to take your money; they don’t care about your rating.

In order to start repairing your credit, you should close all but one of your credit card accounts. Make necessary arrangements to set up payments, or transfer the balance to your remaining account. By doing this, you can work towards completely paying off one credit card with a large debt, rather than working piecemeal with many smaller debts.

If a creditor agrees to give you a payment plan, get that payment plan in writing. Having the plan in writing will protect you if the creditor reneges on the plan or if your debt is transferred to another creditor. If you have finished paying it off, you should request a confirmation so you can send it to the credit reporting agencies.

TIP! It is easy to get a mortgage for a house if your credit score is good. Making your mortgage payment on time each month will also boost your credit score.

Improve your credit rating and open up more opportunities for you in the future. You can take some free steps towards repairing your credit. These tips can make it possible for you to improve your credit effectively.

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Category: Finance

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